Economic Issues and the fall of Roman Empire



Economic Issues and the fall of Roman Empire

Introduction

The downfall of the Roman Empire may be understood as the social decline of the Roman society. There are many theories on the collapse and many reasons behind it. This decline took place gradually over a period of four centuries. The decline was marked by political disintegration, poor economy, downfall of the military and social factors. Many writers in the past have written on the Fall of Roman Empire and given reasons behind it. People have become obsessed with this decline in that it is one of the most studied forever. The question on the exact nature of the fall is posed to date and has not been answered successfully yet.

Other than the conflict on the major causes of the fall of the Roman Empire, the date of the fall is also a debatable matter whereby some hold that the fall took place in A.D. 410 with the sacking of Rome while the others hold that the fall came later in 476 with the deposition of Romulus Augustulus. One of the major reasons which is agreed by most is the economic distress that hit the Roman Empire. The paper discusses the various reasons of this economic distress which led to the fall of the Roman Empire.

Hoarding

One of the primary reasons that led to the economic crisis and inflation was hoarding. This caused decay in the Roman economy. The people in the empire were looting like barbarians. They hoarded goods so that the prices would shoot up. This also caused the trade deficit of the empire to go very high. This hoarding served as one of the major catalyst in the economic decline of the Roman Empire. The currency in the Western empire was not being circulated. When this lack of float of currency was combined with the hoarding by wholesalers, it led to a higher inflation than the people in the Roman Empire could have tolerated. At the same time, it has been observed that the East stifled the growth in the West.

Land and the crushing tax burden

The fertility of the Roman land was the major source of wealth for the empire. In addition, when the land was taxed it created a greater opportunity for the wealth to increase. In an attempt to do this, during the time the Roman Empire was expanding across the Mediterranean, they introduced the concept of tax farming, whereby the farmers were taxed either on their land or on their yield. This concept was introduced parallel to the taxing of provincial governments. When the tax farmers paid in advance to the provincial governments they gained in that their yield was usually higher than the estimated yield. Hence, they gained at the end of the day and the government had to pay for the rests. This hit the peasants and helped the government.

Towards the end of the Roman Empire, it was noted that as the amount of importance which ...