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Roman Empire Debasement In Rome

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collapse is the only outcome that can result which was exactly what was witnessed in the 5th century when Rome met its demise. The debasement of currency which resulted in excessive coin hoarding and hyperinflation most assuredly caused many of the economic problems in the Roman empire. The denarius, the standard Roman currency, was first reduced from 95% silver to 90% silver by the emperor Nero as a means of paying for his Domum Aurium, his palace (Barlett). The reduction in mass percentage of silver per denarius coin allows for an overall increase in the amount of circulating currency by an amount equal to the mass reduction, id est a 5% decrease in silver content increases the amount of circulating denarius by 5%. This policy of debasement became standard for the Roman emperors until the …show more content…

The inflation vastly increased due to the perceived worthlessness of the denarius which resulted in a lower GDP, widespread famine, and increased unemployment. When the merchants perceived the denarius as a near worthless coin, they would either charge exorbitant rates for their products or not trade in Rome at all (Barlett). Due to the decreasing supply of affordable goods and the ever increasing price of these goods, the average citizen was not able to buy food let alone pay their taxes(Barlett). The people, unable to afford even the basic necessities for living, could not produce and buy goods and services causing a decrease to the GDP. The government was then forced to subsidize the citizens in order to avoid famine and rioting in the city. The problem with subsides was that it did not solve the inflation problem, but merely delayed its effects (Flemming). The Roman government after losing the ability to tax a large portion of its citizens was forced to either raise taxes for the wealthy citizens of Rome or continue to further debase the Roman currency perpetuating the overall

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