trading of shares in the societates publicanorum?

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Abstract

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http://dx.doi.0014-4983/C

Available online at www.sciencedirect.com

ScienceDirectExplorations in Economic History 61 (2016) 95–118

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ding of shares in the Societates Publicanorum?☆

Geoffrey Poitrasa, Manuela Geraniob

a Beedie School of Business, Simon Fraser University, Vancouver B.C., CANADA V5A lS6b Dipartimento di Finanza, Università Bocconi, Via Roentgen 1, 20136 Milano, Italy

Received 27 July 2015Available online 1 February 2016

orum’recenticular,] and

This paper demonstrates the often repeated modern claim of significant trading in ‘shares of the societates publican(partes) during the late Roman Republic cannot be supported using the available ‘primary sources’. Building oncontributions detailing the economy of the late Republic, in general, and the tax farming activities of the publicani, in partan alternative more plausible legal and commercial explanation of the ‘primary sources’ – especially In Vatinium [12.29Pro C. Rabiro Postumo [2.4] – is provided.Crown Copyright © 2016 Published by Elsevier Inc. All rights reserved.

Keywords: Publicani; Societas Publicanorum; Equity valuation; Roman tax farming; Share trading

es tos that

It is well known that the study of commercial life inRoman times is hampered by the limited and

due, at least partly, to the negative social attitudsuch activities by those contributors with writing

maryvitie

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rsity a three

fragmented evidence available. Roman ‘prisources’ lack details surrounding commercial acti

☆ The authors are Professor of Finance at Simon Fraser Unive
eferees, as well as assistance from Gianpaolo Baroncheddress: [email protected] (G. Poitras).nce to ‘primary sources’ is somewhat misplaced. Almost allodern times are faded inscriptions, text fragments and not cosuspect due to the habit in Roman times of ‘correcting’ the o, as much as possible, of the original Latin texts. In this pman history. In particular, there has been considerable discues III and Digest [3,4,1]. For example, Daube (1944, p.126)in Latin was done in the early 19th C. by the important Gn texts to English used by modern secondary sources are foul agreement that all survivingmanuscripts (the oldest being frsingle very imperfect archetype. All variants of the originalg what is an ancient ‘primary source’ and what is a ‘modesurviving texts from the Roman Republic available in moly being used as a shorthand to distinguish the ‘modern’ recscholarly journals and books discussing these Latin textsring prior to key ‘primary sources’ in the English translati
org/10.1016/j.eeh.2016.01.003rown Copyright © 2016 Published by Elsevier Inc. All

shave survived as the ‘primary sources’ availabmodern times.1 Important ancient writers suc

nd Professore Aggregato at Università Bocconi. Helpful comments from
lli and David Mirhady on Latin translation are gratefully acknowledged.
of the ‘original’Roman sources examined here have long ago been destroyed, whatmpletely legible copies of copies of some ‘original’ text. Even sections of ‘original’lder source to conform to later practice. The core-business for philologists has beenrocess, it is difficult to avoid some disagreement among philologists, Latinists andssion about themanuscript tradition for the essential sources, especially In Vatinium,gives a number of reasons why the text of Digest [3,4,1] is “corrupt”. Much of theerman philologists such as Karl Lachman. Based on this work, translations of thend mostly in the second half of the 19th C. and the first half of the 20th. In particular,om the 9thC.) for the In Vatinium– an essential source in the claim of share trading–‘primary source’ are due to later scribal corrections or errors. This creates a semanticrn secondary source’. Except for a limited number of faded inscriptions and papyridern times are, in some sense, all ‘secondary sources’. Hence, reference to ‘primaryreations of the original Latin texts from the ‘secondary sources’ that are derivative,. Oddly enough, this nomenclature has some ‘secondary sources’, e.g., Deloumeons of the Loeb Classical Library that commences with titles in 1912.

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Plutarch, Livy and Cicero deal almost exclusively withaignpecties oon inamio bare..bringt thaccumonf thfuzzyaboublic.goingarke

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96 G. Poitras, M. Geranio / Explorations in Economic History 61 (2016) 95–118

non-commercial activity, especially military campand political debate, leaving little trace of many asof ancient commercial life: “the general inadequacthe evidence accentuate the role of conceptualizatihistorical research” (Bang, 2008, p.3). Careful exnation and scrutiny of available sources has tsupplemented by ‘artful’ interpretation. “sourcesnot self-explanatory. They must be interpreted tous to the ancient reality” (ibid.). Given thaboundary dividing ‘artful’ interpretation from inrate inference is decidedly fuzzy, this paper destrates that the modern claim of trading in shares osocietates publicanorum lies well beyond thisboundary resulting in inaccurate inferencescommercial activities in the late Roman RepuThis conclusion has relevance to the wider ondebate over the historical relevance of ‘the meconomy’ in ancient times.

1. Supporting primary sources?

Seeking a reflection of modern times in Rsociety, economic historians from Rostovtzeff (1957) to Temin (2001, 2004, 2006) and Malme(2005, 2009) “have gone their own way in cremodels that describe how early civilizations mightdeveloped if it had followed the lines of mindividualism at the outset” (Hudson, 2002, p.19)debate over the role of commercial motives i

2 Recognizing the difficulties that can arise in Latin to E
translation, clarification of some basic Latin terminology is helpful fothe uninitiated to understand the following discussion. A societas (plsocietates) is a Roman partnership composed of socii (sing., sociusThe publicani (publicans) were public contractors and the societatepublicanorum were partnerships of public contractors. Due to the rolof the publicani (sing., publicanus) in tax collection during NewTestament times, it is common for modern English dictionaries tdefine publicans as tax collectors. While this was an importanfunction of the publicani during the late Republic, public contractorwere also involved in public works construction, working the minesprovisioning the army and other tasks. Roman society was a largelhereditary timocratic society that evolved considerably from thmiddle to late Republic, e.g., Scheidel et al. (2007). The controllin‘aristocracy’ was composed of a small hereditary group of patric(partricians) and equites (‘knights’, sing. eques), a larger class that wainitially hereditary but gradually assumed entry by property classification. Circa the beginning of middle Republic, senior roles in tharmy were reserved for equites. The Roman legionary cavalry wainitially composed of equites but the demands of Roman expansiomeant the first class of commoners gradually came to dominate thcavalry with equites serving mainly as senior officers. The LeClaudia of 218 BC restricted the role of senators in commerciaactivity, ceding participation in the public contracting process to thequites.
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history that includes Halm (1845), Deloume (1Kniep (1896) and Frank (1914). Kay (2014)authoritative recent account. Against this backclaims in modern secondary sources for tradinshares in the societates publicanorum give the apance that there was an organized ‘stock market’ forshares in tax farming ‘corporations’ during theRoman Republic. The explicit reference to “partemodern sources to describe such ‘shares’ giveimpression there was Roman nomenclature, a ‘market jargon’, for such trading. Upon casual intion, there appears to be sufficiently numerousences to primary sources supporting the specific cthat: there was trading in shares (partes); and, inthe societates publicanorum were akin to mbusiness corporations. Only a few modern sche.g., Harris (1975), Silver (2007, n.3), reco“difficult problems” with such claims.3

To benchmark the claimed support in prisources, consider the following modern ‘maximperspective of share trading presented by Malme(2009, p.1089):4

Investors could provide capital and acquire s(partes) without becoming a partner and wibeing liable for the company's obligations. Seancient authors refer to the shareholders osocietates publicanorum as participes or adfinealso know that the shares were traded andfluctuating prices. For instance, Cicero writes

hr 3 Included in those disputing or raising serious questions ab
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interpretation of the societas publicanorum in Badian (1972) is theancient historian Harris (1975): “A more important question concernsthe allegedly wide ownership of shares. It is quite a jump from In Vat.29 to the view that virtually all senators had investments in thesocietates publicanorum, and as for investment by large numbers ofsub-equestrian citizens (what number of them is really meant?),Polybius 6.17 does not establish it, and Cicero significantly claims nosuch thing in De Imp. Cn. Pomp. 17–19. Badian envisages a verylarge number of powerless shareholders, but for whatever reason theyare not to be found in the sources.”4 Malmendier (2009) summarizes the more detailed examination in

Malmendier (2005) that, in turn, is an English variation of Malmendier(2002), in German. The more detailed treatment in Malmendier (2002,2005) contains few additional interpretations and does not addsubstantively to the summary of share trading in Malmendier (2009).For example, Malmendier (2005, p.38) observes: “The next crucialdifference between societas and societas publicanorum – and maybethe most astonishing step forward in the evolution of this businessorganization—was the existence of shares and shareholders. Ciceromentions the partes (shares) numerous times in speeches. Forinstance, he refers to private citizens possessing partes societatumpublicanorum...shares of different companies came in differentnominal values.”

“shares that had a very high price at that time.”ld brectlyringssedly

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ppeauponn oturnf threferni bylistharees. Inng o.102tionctionce iDictaf thhestarchon o

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Sayings’ by Valerius Maximus (Val. Max.) – otherpportrious7] ton the1889,

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ith thepublicani is complicated. The prosopography by Nicolet (1966, 1974)deviates from the traditional position derived from Mommsen thatidentifies the “ordo equester, from the Gracchi onwards, to two groupsof Romans: those who belonged to the 18 centuries and therefore hadthe public horse, and those whose wealth qualified them to receive thehorse but who, in fact, did not receive it. The number of the latter sooncame to be much larger than the former” (Sherk, 1968, p.251). Nicolet

97G. Poitras, M. Geranio / Explorations in Economic History 61 (2016) 95–118

The statement also implies that the shares coubought either from another shareholder or difrom the company, suggesting secondary offeTraders met on the Forum Romanum, supponear the Temple of Castor.

The following primary sources are given to suppovarious elements of this claim: for the organizatithe societates publicanorum, Cicero Pro lege Ma[2.6] and Pro C. Rabiro Postumo [2.4] (Rab. PPlautus Trinummus [330–31] and, Livy Abcondita [xlviii 16.2]; for the essential issue of trshares, Cicero In Vatinium [12.29] (Vat.); and, folocation of trading, Plautus Curculio [78]. Malme(2009) also identifies references in Edward Chan(1999, p.4), even though this source does notsubstantively to those already given. While‘maximalist’ perspective on share trading would ato have substantial support in the primary sources,closer inspection there is only brief discussiopossible share trading in a few sources that, independ fundamentally on debatable interpretation ocommercial and legal context. The most widelyenced modern source on share trading of the publicaan ancient historian, Badian (1972, n.98–104) alsoVat. [12.29 plus 12.13 and 12.15] for the trading of sand Rab. Post. for the organization of these societataddition to the strong claim that there was tradiunregistered shares by senators, Badian (1972, palso claims that “the high stock prices Cicero menare consistent with a price reduction for tax collerights in the same year.”5 An additional referenprovided by Badian to Valerius Maximus, Facta etMemorabilia [vi 9.7] (Val.Max.) as a criticism oearlier ‘maximalist’ perspective of Rostovtzeff. Tand various other secondary sources also claim PluCato Maior [21.6–21.7] recognizes the participatiCato the Elder in a large societas publicanorum.

In addition to the most essential primary sourCicero's orations against P. Vatinius (Vat.), in deof Rabirius Postumus (Rab. Post.) and in favor oManilian law (Pro lege Manilia [2.6, 6.15, 7together with a section from ‘Memorable Deeds

5 This view is inconsistent with the important German philolo
Orelli (1835) where fluctuations in the value of a share in the Asiatithes and customs revenue was due to political decisions changing thburden on the citizens of the relevant provinces to maintain ‘serenitand stability’. Perhaps the reduction in tax collection rights that wanegotiated in Rome is connected but there is no evidence of suchconnection. Badian (1972, p.100) claims over-bidding on the contractdue to increased competition from “the influx of the Italians intrecognized citizenship”.
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related sources are also provided for context to sumodern claims of share trading. In particular, vasecondary sources quote Polybius Histories [vi 1establish the context for the contract system ieconomy of the Roman Republic (Shuckburgh,trans.):

The people on its part is far from being indepeof the Senate, and is bound to take its wishesaccount both collectively and individually.contracts, too numerous to count, are given othe censors in all parts of Italy for the repaiconstruction of public buildings; there is alscollection of revenue from many rivers, harbgardens, mines, and land—everything, in a wthat comes under the control of the Rgovernment: and in all these the people at largengaged; so that there is scarcely a man, so to swho is not interested either as a contractorbeing employed in the works.

In contrast to Brunt (1962), another ancient histthat is also an acknowledged expert on the publBadian (1972, p.45) claims that Polybius “is cinterested in the publicani when he speaksthe People”. Brunt extends ‘the people’ to includequites, not just those socii involved in the cosystem. This is relevant because only a fraction oequites were involved as publicani and many offew were also money lenders (Nicolet, 1966, 1974

Significantly, the relevance of the next part osection from Polybius [vi 17] is often ignored:

some purchase the contracts from the censorthemselves; and others go partners with them;others again give security for these contractoactually pledge their property to the treasurthem.

6 The precise identification of equites and the relationship w

neysaso

disagrees and reserves equites for those that had formally received thepublic horse. This identifies equites with a narrower, more distinct‘noble class’, as opposed to the traditional, more loosely definedgrouping. Using this narrower grouping, the prosopograhy reveals:“Out of a total of over 370 [equites] only 37 were publicani and only46 were negotiatores or foeneratores. And many of the last group alsobelonged to the first, being engaged in multiple activities” (ibid.,p.252).

This explicit statement about legal contracting methodsthanng ostsitionThadualns of thndaryimedntracaresander, ing obasictionet thch a

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of the publicani at the time of Polybius (no later146 BC) is revealing. There is no reference to tradishares, though the ‘purchase’ of contracts suggepossible need for capital. There is explicit recognthat partnerships were used by the contractors.some contracts could be ‘purchased’ by indivisuggests that not all contracts were beyond the meaa single individual. This general description ocontract system by Polybius is reflected in secosources going back to Kniep (1896) where it is clathat a lead publicanus, the manceps, takes up a coand is joined by other partners (socii) who hold ‘shand, possibly, undertake to provide the labororganization needed to fulfill the contract. Howevis difficult to infer whether there was possible tradiregistered or unregistered shares from suchdescriptions. Further details regarding Roman auprocedures and contract law are needed to interprcommercial implications of essential actions su‘giving security’ and ‘pledging property’.

The societates publicanorum were formed to pipate in the public contracts auctioned by the cein Rome and other locations. Though noevidence has survived on the specifics of auctithe important Asian tax farming contracts, informabout auctions for hiring storage space within pwarehouses indicates the use of consensual (likelwritten) locatio conductio contracts (Du Plessis, 20As detailed in Rauh (1989a), reference to ‘gsecurity’ for contractors likely reflects the centraof financiers and money lenders in the private

7 More precisely, consensual contracts (obligationes con

werswerety, hewaswho

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involve four classes of non-delictual obligations. Obligationes rewhich arise from a fact or an act such as mutuum (loan) with nformalities required, only the intention to impose or assume aobligation. Obligationes verbis which arise from verbal agreementsexpressed in very formal terms (stipulatio). This was the moscommon form of contract in Roman law. The stipulator would askquestion such as: ‘do you solemnly promise to give/do…’? (spondesndari/facere …), to which the other party would answer: “I do promise(spondeo). Obligationes litteris were written agreements, but theswere exceptional and used in cases such as when debts are transferrein the accounts of one debtor to another. Finally, obligationeconsensus involved a consensus between contracting parties such aemptio/venditio (sale), locatio conductio (rent/hire), mandatum(commission, mandate), and societas (partnership). In all of thescases it was customary to write down the terms of the contracts iwriting tablets that were then sealed, with a copy attached on thoutside. These are chirographa, or testationes, or cautiones. Thesdocuments provided proof in court, but they did not create thobligations. If the documents were missing but the parties could finother proof to convince a judge in case of dispute (for instance througwitnesses), the contract was just as valid.

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Watson (1984) demonstrates that the Roman larecording, securing and settling contracts used ipublic auctions evolved considerably in the pbetween the middle and late Republic. The proceverbally pledging assets as security (pignus) thsome cases, could include landed property, wlegally require ownership of the pledge to residethe treasury during the period of the hire. Whethehow such a transfer was done is unknown, but a ‘pof property to the treasury’ at a public auction (cenlocatio) would involve a legally enforceable methrecording such pledges. Public auctions by the cerequired participation of praecones publici (pauctioneers), one of the apparitores (official pservants) required of a censor, capable of serviwitnesses to a consensual contract (Rauh, 19Written details could be recorded by another oapparitores, the scriba, or in the account boomoney lenders. Whether all socii involved in a cohad to be registered is unknown.8

The relevance of Plutarch Cato Maior [21.6–21a primary source in modern claims of share tradicaptured by Malmendier (2009, p.1089):

Plutarch quotes Cato with the expectation thareaders in the early Roman Empire would underhis boasting. In other words, educated Roknew about the possibility of buying shares isocietates publicanorum.

Written during the early Empire, Plutarch Cato M[21.6–21.7], states (B. Perrin, 1914, trans.):

[Cato] used to loan money also in thedisreputable of all ways, namely, on ships, anmethod was as follows. He required his borroto form a large company, and when therefifty partners and as many ships for his securitook one share in the company himself, andrepresented by Quintio, a freedman of his,accompanied his clients in all their ventures. I

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8 There are hints that possibly all socii were registered in an earlycontract for the supply of clothing to the legions in Spain during thesecond Punic war at the end of the third century BC: “the contract waswon by a syndicate of nineteen publicani and that therefore the capitalcontribution of each of them was just over 40,000 denarii (6.7 talents),an amount equivalent to 40% of the property qualification forequestrian status in the late Republic” (Kay, 2014, p.12). However,this contract is from a period long before the late Republic when sharetrading is claimed and evidence of registration is unavailable. Thecontract is also for provisioning of troops, not tax farming or publicworks.

way his entire security was not imperilled, but only a

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therount otradle olaceineds the thMosrcesationno

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trading by senators.10 Given the role of the Senate anduringicallyietasdirectuites.in a

ul ifssiblejoin ag tos no.sharerces,mple,ce ist the1957,

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small part of it, and his profits were large.

There are a number of problems with interpretingsource as support for share trading during theRepublic. There is the problem of timing. Plutardiscussing the consul and censor Marcus Porcius(Maior, the Elder) (234 – 149 BC) while prisources on trading of shares are silent until the timCicero and Cato the Younger, great grandson ofthe Elder, about a century later.9 In additioncommercial context is different. As a condition forloan from Cato, borrowers in the loan are requirform a partnership in which Cato participates. Tsubstantively different, in both a legal and a commsense, from the tax farming and public works actiassociated with the societates publicanorum of thRepublic. The source does reveal that senators, coand others of high Roman office during the mRepublic did conduct business through others, Quthe freedman in the case at hand. As for share tra‘he took one share in the company’ does not susuch a claim.

The modern claim for trading of ‘shares insocietates publicanorum’ (partes) suggests numsubstantive questions, in particular: what instrumesecurity was being traded? who was permitted toand what objectives motivated the purchase or sa‘shares’? where and when did the trading take phow was trading conducted and ‘prices’ determcould purchased ‘shares’ be re-sold? how active watrading? how was payment made? and, how wertransactions and change of ownership recorded?of these questions are not addressed in primary souSignificantly, the few sources detailing the organizof shareholdings in a societas publicanorum doprovide any direct evidence about the unregistereshares that Badian and others infer were the sour

w incultsand

d itshich

9 The silence is due to claims for share trading being based largelon passages from Cicero. This is not a date for beginnings of thpublicani involvement in tax farming, in general, and Asian tafarming, in particular. Kay (2014, p.74) observes: “the first mention iour sources of censors letting contracts for portoria is in 199 at Capuand Puteoli”. The role of the publicani in tax farming was aideconsiderably by the Lex Sempronia de provincia Asia, introduced bthe tribune C. Gracchus in 123/2 BC, that required the use of censorilocatio ‘in Rome for all the see’ in the auctioning of Asian tax farmincontracts (Kay, 2014, esp. p.73–82). While done to deter extortionthis method of farming state revenues gave tremendous commerciaadvantage to wealthy Roman equites that also functioned as monelenders and traders in the Asian region.

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the censors in the awarding of public contracts dthe late Republic, it was inappropriate and technillegal for senators to be directly involved in a socpublicanorum bidding on public contracts;participation in the auctions was restricted to eqIf a record was kept of some (all?) socii involvedcontract, unregistered shares would be helpfsenators acquired an interest directly. The potrading of registered shares by an eques seeking tosocietas publicanorum with a publicanus seekindispose of an interest in that societas receiveattention in modern sources claiming share trading

Even where elements related to possibletrading can be identified in the primary souevidence is often vague or questionable. For exathe question of when and where trading took plaanswered by the claim that the location was aForum near the Temple of Castor. Rostovtzeff (p. 31) provides a romanticized description:

Business was daily transacted at the exchange,the temple of Castor in the large public place of Rthe Forum. Here crowds of men bought andshares and bonds of tax-farming companies, vagoods for cash and on credit, farms and estates inand in the provinces, houses and shops in Romelsewhere, ships and storehouses, slaves and cat

This seems innocuous but the primary source givsupport is Curculio[78] by Plautus, a source thatnot provide substantive evidence supportingtrading at this location. Frank and Stevens (p. 79) detail what is available in the few primary sothat could apply, especially Cicero Pro Quinctiowhere there is an obscure reference to the use otemple of Castor in deposit banking. Instead of asupporting the location of share trading, the tempCastor and Pollux (initially dedicated in 484 BCrebuilt in 117 BC) is described by Frank and Steveone of:

two temples in the Roman Forum which greimportance despite the constant decline of thefor which they had been built, those of Saturnof Castor and Pollux. Saturn's temple oweprosperity to its situation near the Curia, w

yexnadya 10 Badian (1972, p.105) does recognize that “senators – like P
g,ly
and Brutus – were also the principal money-lenders in the provinces,probably using equites as their agents”. However, it is also claimed:“By the end of the Republic, the principal business affairs of theequites must have been well on the way to being shared, if not takenover, by senators”.

occasioned its adoption by the senate as theastoce o, andorumcinccouldoffic

s andonlye lats alsousede fonsorsoriar thh thodernsharatingrasitoneylikelylater,ainston to

of collecting different state revenues.12 These societatesublic,2 BCBC.that

lvingublic, theate.13

ction,thanctionmingiodicurcesng isd for

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blicus”and, a wider sense, “all regular and ordinary sources of Romanrevenue, as distinct from the extraordinary tributum” (Smith andMarindin, 1890). It is conventional in modern usage for vectigalia tobe used in the wide sense. Narrow sense vectigalia are referred todirectly as decumae (the tithe, a fixed percentage of crops) and thescriptura (grazing fees). Additional Roman state revenues that thepublicani could collect include: rents for houses on public land(solarium); sale of timber on public land (vectigal picariarum);customs duty, including revenue from public buildings and markets(portorium); revenue from salt works (salinae); revenue from mines(metalla); and, various taxes on goods sold. State control of salt works


depository of the state funds, while that of Cgrew with the ever-increasing political importanthe knights who employed it as a meeting placewith the rapid increase of business in the Fwhich created the need for some sacred prenearby where standard weights and measuresbe kept readily accessible and an assayestablished for the testing of foreign coins.

The evidence for the keeping of standard weightmeasures is from imperial inscriptions, leavingspeculative conclusions about activities during thRepublic (Frank and Stevens, 1925, p.80). There ievidence that the temple of Castor and Pollux wasduring the early Republic as a meeting placsessions of the Senate and, possibly, by the cefor the auctioning of tax farming contracts (cenlocatio). Perhaps there was trading of shares neatemple of Castor prior to or in conjunction witletting of contracts? However, the reference in msources to Curculio as supporting the location oftrading does not capture such a possibility. DCurculio to circa 192/193 BC, the use of the paCurculio to fraudulently obtain funds from a mlender located at the ‘old shops’ in the Forumrefers to the Lex Sempronia on usury of 193 BC (S1987).11 This references the on-going struggle agusury in the middle Republic and has no connectitrading of shares.

2. Commercial and legal context

tatese thes ther thispointiatedlate

toriesharesietasposes

was in place long before the late Republic. Livy [ii 9] providesevidence of a state salt monopoly in the 6th century BC. Theimportance of salt in the ancient world finds a variety of methods andlocations producing salt including: rock salt mines; brines; and, largescale drying of sea water. The type and variety of taxes collectedvaried by locale. For example, Reiter (2004) identifies taxes collectedin Egypt during the Empire as including: poll taxes; land taxes; boattaxes; transfer fees; donkey licenses; and, weavers' fees.13 Kay (2014, ch.3) discusses the different perspectives on the role ofthe publicani in the Spanish mines (see n.21). Significantly, Daube(1944, p.126) also includes organizations of “bakers, shipowners andthe like” as “association(s) with corporate capactiy” during theRepublic. These groups were not organized as societatespublicanorum but, rather, were organized as collegium. It is possiblethat societates was substituted for sodalitates by the compilers of theDigest. This suggests a religious connection stressed by Daube (1943,p.86): “no history of personality in Roman private law can be deemed

Modern claims for trading of ‘shares in the sociepublicanorum’ (partes) fail to adequately recognizdifferences in commercial and legal context acrosvarious uses that the Roman state permitted fomethod of ‘corporate’ organization. The basicbeing made in this paper is that the context assocwith tax-farming the public revenues during theRepublic, especially those in the conquered terriof Asia minor, is inconsistent with trading of sin the societates vectigalium, a type of socpublicanorum given special legal status for the pur

11 Plautus, Curculio [78] observes: “There, at the old shops, are theswho lend and those who borrow at interest. Behind the Temple oCastor there are those to whom unguardedly you may be lending tyour cost.” The translation of Riley observes: “old shops probablalludes to the old shops in the Forum, which were the property of thstate, and were let out to the bankers and money-lenders.”

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were especially important during the late Repfrom the Lex Sempronia of C. Gracchus in 123/2until the fiscal reforms of Augustus starting in 27In turn, the tax-farming context differs fromassociated with the other essential activities invothe societates publicanorum: the erection of pworks such as temples, roads and aqueducts; andoperation of mines and quarries owned by the stFor example, in the case of public works construthe activities involve an state expense, rathergeneration of revenue as with tax-farming. Construprojects have a fixed endpoint while the tax-farrevenues were long-lived, though subject to perauctioning of contracts. Based on the primary soused in support, the modern case for share tradistrongest for the societates publicanorum organizetax-farming, i.e., the societates vectigalium.

To avoid semantic confusions, understandincommercial and legal context for claims oftrading and other activities involving the socie

12 Vectigalia has both a narrow sense, “dues levied on ager pu

efoye

entirely satisfactory unless it contains a full discussion of personalityin Roman religion, pagan as well as Christian.” Not all collegium hadcorporate capacity. Duff (1938, p.144) also suggests burial clubs couldqualify. Buckland (1963, p.176) makes the telling observation: “Therewere numerous gilds or societies with diverse objects, trade gilds,burial clubs, etc. Many had corporate character, many had not, and itis not easy for early law to distinguish”.

publicanorum requires definition of important terms –panylarifyoftennt oublimanlaimtractd tourityhecaherch anharesiderdinginciaand(andfromistraon o1994nts oincen thazingount2006ficul

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shares, share trading, company, joint-stock comcorporation. Appropriate definition is essential to cvarious claims made in modern sources. It isstated that, during the late Republic, the amoucapital needed in Asian tax farming and certain pworks was in excess of the wealth of the richest Roindividually. Exploring the precise details of this cit is apparent that to satisfy the tax farming consome form of ‘capital association’ was requireprovide sufficient coined money, capital and seceither by pledge (pignus), or stipulation or hypottion, e.g., Watson (1984). By construction – whetpartnership, corporation or other legal form – suassociation will have ‘shares’.14 The claim that sare both ‘tradeable’ and were traded requires conably more. As for tax farming in the provinces, funthe activities of the revolving Roman provadministrations required: any initial coined moneycapital obtained from contracts auctioned in Romeelsewhere) to the publicani; plus funds receivedthe settlement of accounts for the previous admintion; and, the regular and possibly irregular collectivectigalia and other state revenues (Richardson,p.585–9). Given that transportation of large amoucoined money between Rome and the Asian provwas risky and costly, a network of socii located iprovinces was essential for collecting the tithes, grand customs duties and for sourcing significant amof currency and credit locally, e.g., Harris (p. 13–5). The ‘shares’ of such socii would be difto trade.

A number of substantial conditions need tsatisfied before a ‘share’ in a commercial venturbe ‘traded’. The precise conditions depend on thetype of business organization. For a number of reaa ‘share’ in a private partnership is more than difto trade compared to an exchange traded ‘share’limited liability corporation. As a consequence,

14 Ireland (1996) makes strong claims about the importa
ionals noth therizedbilitynd ain a
f thed theorian

‘shares’ in the emergence of the ‘corporation’: “In the eighteenth anearly nineteenth centuries... the act of incorporation did not effectcomplete separation of company and members. Such a separation diemerge during the course of the nineteenth century... and was notproduct of incorporation per se. The origins of a reified conception othe company... are to be found elsewhere, in the emergence of the joinstock company share as an autonomous form of property.” In effecthe concept of a corporation is incomplete without ‘autonomousshares. This feature is essential for trading of shares. AlternativelyDigest [17.2.7] and [17.2.14.1] make reference to the possibility thatsocietas may not have shares, depending on the preferences of thpartners, and detail how the property of such a societas would bdivided at the end of the societas.

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publicanorum (partes) also propose ‘corporate‘joint stock’ organization. Legal and economicrians have long recognized differences betweenstock and modern ‘corporate’ organization, e.g., P(2000, p.267–72; 2016). For example, KesslerTemin (2007, p.318) recognize this distinctiomaking the weaker claim than the ‘maximaMalmendier and Badian: “There is evidence shothat at least some Roman companies functsimilarly to the joint-stock companies of the Enand the Dutch in the sixteenth and seventcenturies”. This may be intended to implicitly refethe initial appearance of an impersonal marketrading in shares of the VOC (Dutch East ICompany), a joint stock company that commenc1602. This predates the historical emergence oprivate, commercial limited liability ‘corporation’first half of the 19th century, e.g., Taylor (2006), Ir(1996).

Reference to the societates publicanorum asstock’ companies requires careful historical anddistinctions. For example, in the 16th century astock company’ could be an unincorporated comwhere a sizeable number of investors pooled capita risky commercial venture. Being little more thanpartnerships, shares in such joint stock companiesoften not tradeable and the capital stock la‘permanence’. The early English slaving voyagJohn Hawkins, in which Queen Elizabeth particias an investor, were of this form – with a separatiownership and control, without the ‘corporate’ idprovided by a charter and liability determined ifashion of partnerships. The 16th century also feachartered ‘joint stock’ companies – such asMuscovy and Levant companies in England – thexchange for a substantial consideration to the Crwere chartered with a monopoly on trade to a spregion. Such companies were formed as a ‘politic’, with corporate personality and detailed gnance rules to define the separation of ownershipcontrol. However, due to the potential for additcalls on shareholders and other factors, liability walimited in the modern sense. The contrast witfeatures of a modern ‘corporation’ – characteby exchange traded autonomous shares, limited liafor shareholders, a separate ‘corporate’ identity aseparation of ownership and control – is obscurednumber of secondary sources.

An example of a confusing interpretation orelationship between a joint stock company anmodern corporation is provided by the ancient hist

fdadaftt,’,aee

Verboven (2002, p.23): “The legal concept of themitedwa

e, the firswerIndiapitarformre oodernrivatrownoftened toEaslar totionansfehareVOCin th

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‘corporation’ as a private enterprise with liliability dates from the Early Modern period andintended to facilitate long distance maritime tradElizabethan ‘East India Company’ (1600) being thof its kind.”15 The 200 joint stock partnersregistered by name in the charter for the EastCompany. Failure to satisfy a call for additional cfrom shareholders to provision ships or peother duties set out in the charter meant forfeitushares. This is not ‘limited liability’ in the msense. Though the East India Company was a ‘penterprise’, obtaining a charter from the Cinvolved a public purpose. Such companies wereinstruments of state objectives and were requirperform further services to the Crown. The DutchIndies Company (VOC), formed in 1602, was simithe Elizabethan East India Company, with addifeatures in the charter that facilitated the ready traof shares. Hence, by being able to readily transfer sin the Amsterdam market, the liability of ashareholder was more ‘limited’ than a shareholder17th century East India Company.

Any capital association can be loosely defined‘company’ or, where business involving the stainvolved, a ‘state enterprise’. Such terms are geand are not indicative of the organizational structuthe company or whether trading of ‘capital sharespossible. For example, the 15th to 17th century En‘Company of Merchant Adventurers’ was a regucompany with ‘shares’ that were acquired by birthrigh

15 As evidence, consider that the charter of the East Indies Co

issue

tatesmbercientntion-at canoume

me ofion is

contains a list of 200 named individuals and the requirement tha“they, at their own Adventures, Costs, and Charges” are required tsatisfy the following: “[The] Company of Merchants of LondonTrading into the East-Indies, and their Successors, that, in any Time oRestraint, Six good Ships and Six good Pinnaces, well furnished witOrdnance, and other Munition for their Defense, and Five HundreMariners, English Men, to guide and sail in the same Six Ships anSix Pinnaces, at all Times, during the said Term of Fifteen Years, shaquietly be permitted and suffered to depart, and go in the saiVoyages.” This is not consistent with limited liability as there isdistinct possibility of calls for shareholders to provide more capitabeyond the initial amount of the initial investment. The early joinstock companies often made additional calls on shareholders. As foseparate corporate identity the charter is clear on registration ascondition of shareholding: “they and every of [the 200 nameindividuals] from henceforth be, and shall be one Body Corporate anPolitick, in Deed and in Name, by the Name of The Governor anCompany of Merchants of London, Trading into the East Indies...The commencement of trading in Amsterdam of shares in the DutcEast India Company required specific conditions in the compancharter relating to the method of transferring shares. Such conditionwere not included in the (English) East India Company charter o1600.

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general, and the concepts of limited liabilityincorporation, in particular, have a long history.Roman state (Senatus populusque Romanus) and,cially, the municipia and coloniae – towns withautonomy – evolved as legal public entities separateindividual citizens. From this point, determining thein Roman private law of corporate entities with “jupersonality” is “a vast and deep problem” (Duff, 1Daube (1944, p.128). A number of private arrangethat had achieved a level of corporate status durinlate Republic were collegia, universitates, decuriasodalicia. In the general case of a societas, Verb(2002, p.277) observes:

Roman societas was fundamentally differentmodern corporations or trade companies, whiccharacterized by their corporate capacity. Outdoing business with socii could in no way acclaims on or incur obligations toward the sociesuch because the societas as a legal entity did not

Against this backdrop, societates publicanorum‘corporate’ personality independent of the sociiestablished during the Republic. This ‘corppersonality originated by extending the public peality of the populus Romanus. In effect, the sociepublicanorum were private partnerships with ‘crate’ features needed to fulfill public duties, i.e.farmers were contractors providing essential revfor the state and public works contractors were buiessential infrastructure.16 Beyond this, there ievidence that the societates publicanorum h‘private’ corporate personality independent ofextended by the Roman state. This is an essentialfor the claim of trading in shares.

Specific organizational details of the sociepublicanorum are scant and scattered through a nuof primary sources. Despite a paucity of details, the anhistorian Balsdon (1962, p.135–6) provides a conveal modern description of a societas publicanorum thbe found in earlier secondary sources, including Del(1890) and Kniep (1896):

The only tax-farming company (societas) at Rowhose organization we have a detailed descript

yto,fhddlldaltraddd” 16 This position is captured by Thomas (1976, p.472); “bei
hysf
means of tax collection in the Republic, the societas publicanorumhad links with the state which gave it several peculiarities as againstthe ordinary societas... These peculiarities, however, were deviationsof convenience from the normal principles of societas rather thansymptoms of conscious thought in terms of corporate personality”.

the company which farmed the ‘scriptura et sexs),ctorii). Inming(Propera

ptionly Inth taxclue[xii4.9]marytailedrrect thed inem Ion otithTh

ed inoneaxesctioncticuered986atolith

rums andas togallyfundessesedlaimuristlaw988)welurcesheseolog-wayser, toeriod

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ecauseRoman law evolved over time and the period from the Grachan law(Lex Sempronia Agraria) to the end of the Republic was an especiallyactive period of legal change and evolution. It is well known that thedating of legal opinions listed in the Digest is not transparent. TheInstitutes, likely written during the early Empire and largely concernedwith Roman ‘old private law’, lacks detail on specific issues associatedwith the societates publicanorum.


publica’ of Sicily; it had a Chairman (MancepManaging Director (Magister), a Board of Dire(Decumani), and there were Shareholders (Socthe province the staff of this as of all tax-farcompanies consisted of a Local ManagerMagistro) and of minor officials (Qui odabant).

The primary sources for this detailed descriare scattered and numerous. Of these sources, onVerrem [ii 2.169–2.175; ii 3.167] deals directly wifarming in Sicily. Sources that provide furtherinclude: Ad Atticum [xi 10.i]; Ad familiares9.2–9.3]; Val. Max. [vi 9.8]; Livy [xxxix 44.7–4and, Polybius [vi 17]. On balance, these prisources are insufficient to support the dedescription given. Has artful interpretation or incoinference taken place? Basing inferences abouorganization of the societas publicanorum involvSicilian tax farming described by Cicero In Verrseems somewhat incongruent given that recognitithe Lex Hieronica meant contracts for the(decumae) were auctioned in Sicily, not Rome.scriptura and the lucrative portoria were auctionRome, though Scramuzza (1937) indicates onlypossibly two, societates were farming those tTraditional Sicilian methods of decumae colleattract modern attention because of claims this prawas adopted by the Romans in other conqterritories. Sherwin-White (1977) and Cotton (1demonstrate the organization of tax-farming in Anwas also dependent on local traditions, givendiscretionary authority of the governors.

A ‘trade’ of a ‘share in a societas publicano(partes) is an inherently legal operation. The rightobligations associated with ownership of a share hbe legally defined; the transfer of ownership lerecorded; an accurate legal receipt provided forexchanged. Perhaps verbal agreements with witninvolving only familiares and other amicii were uIn any event, certain legal details relevant to the cof share trading attracted attention from Roman jand are captured in the essential sources of Romanthe Institutes of Gaius (Gordon and Robinson, 1and, the Digest of Justinian (Watson, 1985). It isknown that the manuscript tradition for these sooriginates well after the end of the Republic. Tsources also suffer, to varying degrees, from philical difficulties. In addition, legal sources are not alindicative of actual commercial activities. Howevignore legal sources surviving from the imperial p

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features of Roman commercial law. Given thnumber of sections are relevant: Institutes [III, 148and Digest [17,2] on the organization of partnersDigest [3,4] on actions for and against corporate boDigest [39,4] on actions against tax farmers; D[50,10] on public works; Digest [19,2] on leasehire; Digest [6,3] on actions for vectigalian land; D[10,3] on actions dividing common property;Digest [50,11] on markets. If claims of share trare correct, the absence of any legal interpretatiothe Institutes and Digest directly relevant to podisputes arising from the ‘trading’ of sharepresumably, because this was only a practice dthe (late?) Republic and, for some opaque rereceived no interest from the jurists of the Empire

Given the absence of any reference to share traattention focuses on relevant legal features of ‘crate’ status. The most significant legal description osocietas publicanorum is found in Digest [3,4,1] wprivate ‘corporate bodies’ are described:

Partnerships, collegia and bodies of this sort mabe formed by everybody at will; for this rigrestricted by statute, senatus consulta, and imconstitutiones. In a few cases only are bodies osort permitted. For example, partners in tax fargold mines, silver mines and saltworks are allowform corporations... Those permitted to focorporate body consisting of a collegium or partneor specifically one or the other of these have theon the pattern of the state to have common propecommon treasury, and an attorney or syndic thwhom, as in a state, what should be transacted andin common is transacted and done.

Significantly, there is considerable debate ovetextual validity of this “corrupted” source (Daube,p.126). In addition to ‘bad Latin’: the souridentified in Watson (1985) as Gaius, ‘Commentathe Provincial Edict’, Book 3, not the more influInstitutes; and, the reference to imperial constitutinvolves a method of organizing these actiappearing during the Empire. Given such qualificaDigest [3,4,1] can be claimed as support for the po

17 Reliance on the Digest and Institutes is complicated b

of the ancient historian Verboven (2002, p.278) and18

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authorities in the Asian provinces to collect taxes withinof thes andposesarietyests aalso

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others :

In some exceptional cases a societas was grcorporate capacity by a law, a senatorial decr(later) an imperial constitutio. The most faexample is the large societas vectigalium formcollect taxes on behalf of the state. Under the Repthey were no doubt the only ‘incorporated’ societ

The precise meaning of ‘incorporated’ in this caelusive. Property held in common is a featupartnerships that can be found in the origins of Rlaw (societas ercto non cito). Common property ‘opattern of the state’ indicates that a partner does not hatraditional right of socii to bring an actio pro socdissolve the partnership (Institutes III, 151). Similarlysocietas survives the death or bankruptcy of a s(Institutes III, 152). As such, the societates publicanhad a ‘corporate’ identity separate from the socii. Thiexceptional in the Roman law of societas at the timelate Republic and provides indirect support for a liclaim of possible share trading, e.g., if a partner d‘share’ may become available for sale. Howeve‘corporate’ features granted were only those necessaensure that the essential state activities of revenue colleand public works construction were not disrupted.

The two other features for the societates publicandescribed by Gaius as ‘on the pattern of the statedecidedly more elusive to clarify. For the munhaving a common treasury was essential for the provof common services and maintenance of public worthe Greek and Roman eras, the ‘treasury’ was typicbuilding of importance, reflecting the independent crate status of amunicipium or city state.Having a comtreasury in the sense of the collegia that, say, emamong soldiers during the early Empire often mecommon fund that would be used to pay burial expand, possibly, provide a rudimentary form of ‘insurance’, e.g., Lewin (2003). The need for a sopublicanorum to have a ‘common treasury’ isrelated to the publicani providing essential fundprovincial administration and, where appropriate, mpayments in Rome. The ‘common treasury’ wprovide a fixed location where the tax collection buof the societas could be conducted and revenues coland disbursed. If the publicani employed mun

18 In referencing ‘the large societas vectigalium’, Verboven a

yndicotheriatedlity of

to be claiming there was only one large societas involved in the tacollection, as opposed to there being a number of societates. Thiposition is at odds with the accepted interpretation that different taxessuch as the scriptura and portia, were auctioned separately aninvolved different societates.

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their scope of influence, then the ‘common treasury’local authorities could be used to collect state revenuedisburse funds to the Roman administration for pursuch as provisioning the troops and compensating a vof officials on governor's staff. Digest [3,4,7.1] suggcommon treasury of a societas publicanorum wouldprovide a legal method for those “put to some expencollecting taxes or erecting public works to seek rewithout having to take action against socii individua

The final feature identified by Gaius in Digest [– having an attorney or syndic act in the common in– implicitly requires some method for the socii toand replace such an individual. This feature also exthe traditional limited liability of a socius in, speculium beyond initial funds invested (plus anyearned) if not directly involved in the managementventure, e.g., Digest [17,2,25]. Further detail oliability of the socii is provided in Digest [39,4,1]:tax farmer or his familia takes anything by forcename of the public revenue and it is not returned,grant a judicium against them...”. It is observed‘familia’ in this context includes all familiares whofor the tax farmer collecting vectigalia. This incslaves owned by the tax farmer, freedmen and sbelonging to others. Digest [39,4,6] provides detaliability when tax farmers act in concert: “If a numbtax farmers has been involved in making an iexaction... all shall pay their share and anything thacannot pay will be exacted from another.” Finally, D[39,4,9.4] observes that: “Where partnersvectigal-collection administer their shares of the coseparately, one of them can legally petition to havshare of another who is of doubtful solvency transto himself”.

Digest [39,4] and other sections demonstrate thatin the societates publicanorum did not have the liliability of a modern corporation. Most legal actionstaken against a socius, not the societas. Those famiresponsible for the collection of taxes were responsithe socius and not the societas. Even when acticoncert, the liability was individual and would be saccording to the partnership agreement. Because pacould ‘administer shares separately’ the role of the sor attorney acting in the common interest is, again,related to conducting tax-farming business in a nuof locations, e.g., in Rome and the Asian proassociated with the contract, and the need to disfunds for Roman administration. This allows the sor attorney to act in place of a socius who is in anlocation or is otherwise unavailable. Is the assocliability of the socii consistent with the broader liabi

sxs,d

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company? Such a comparison is complicated ddifferences in the commercial context betweenRepublic tax-farming and long-distance seaborneof the early joint-stock companies. The presenceattorney or syndic, somehow selected, creates a liafor the socii similar to that of shareholders in thewith respect to the assembly of ‘Seventeen Masters’Poitras (2000, p.273). However, resources of the soused to collect taxes were owned individually unlikjoint-stock companies where ships, cargoes, outpostthe like were owned by the company.

3. Tax farming in the late Republic

Modern secondary sources typically identifygeneral types of commercial activities involvingsocietates publicanorum during the Republic: tax farand public works. Yet, based on contributions goingto Orelli (1835), claims for trading of sharesoverwhelmingly associated with tax farming, littlemention is made of share trading associated with pworks activities or supplying the armies or workinSpanish mines. That societates publicanorum involvpublic works had elements of ‘corporate’ status is dein Du Plessis (2004) where a contract for renovatinsecond Temple of Castor survived the death of thesocius. Some modern sources claim large construprojects such as building large aqueducts requi‘permanent’ capital stock and, as such, also satiprecondition for share trading, e.g., Kiser and(2007). However, this is not supported in the prsources that focus on legal protections providecontractors and often identify temple constructiowealthy, status seeking Romans as the objective opublic works contract. Shares of socii in contracpublic works projects providing construction expand equipment would be particularly difficult to traLimited scope for sizable and continuing p

19 Under the Principate, public works construction by the s
publicanorum was diminished to the point where by the time of Justinianthe Digest makes no reference to the societas publicanorum, only to thsocietas vectigalia (the society of tax collectors). Modern interpretations othe societates publicanorum are aided by starting the historical record witPolybius, Histories [I 6.17] where the activities of the contract systemduring the middle Republic are recognized. Considerably less attention igiven to factors leading to the demise of the late Republic contract systemunder the Empire. In turn, the contract system for tax farming and publiworks construction spans the dramatic economic, political and militarchanges that took place from the early to late Republic. As Brunt (1962recognizes, these changes were such that practices for the societapublicanorum in the early and middle Republic could, possibly, diffesubstantively from the late Republic.
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projects.The practice of farming state revenues to p

collectors likely predates the appearance of cunewriting; it was not unique to the Romans. The EgySumerian, Babylonian empires and the Greek cityall farmed state revenues, though the precise meemployed varied over time and location. The pracontinued into the 17th century in England (As1956), the 18th century in France (White, 2004) an20th century in S.E. Asia (Butcher and Dick, 1Tax-farming during the late Republic was unusuceding control of the tax farms to a narrow ‘clasmiddlemen located in Rome – the equites involvpublicani – not in the locations where taxescollected. Under the reforms of Augustus, tax-farwas decentralized by giving increasing authoriprovincial governors and cities, at the expense opublicani in Rome, e.g., Macmullen (1959), B(2004). The political motivation underpinningevolution was tactically facilitated by the likely ulocal administration in the actual collecting of cstate revenues by the publicani of the late Republiwhat extent the Augustan fiscal reforms alteremoney-lending and credit sourcing role of publicathe provinces is difficult to determine, thoughancient historian Andreau (1999) does provideinsights.

Identification of the type of contracting meemployed is essential to the commercial contextpotential for share trading in the late Repubenhanced when the initial capital provided to utake the contracts is substantial and an imposource of capital is provided by “sleeping partne.g., Buckland (1963, p.513), Monro (1902, p.7Tax-farming could be legally organized as a socof capital, provided by the sleeping partner,‘labor’, provided by the socii responsible for oveing the actual collection of taxes. ‘Shares’ ocontracts held by a societas publicanorum cou‘created’ by a sleeping partner undertaking a ‘s

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20 The supporting secondary source provided by Buckland for thepresence of sleeping partners is Monro (1902). Mitteis (1908) whichdeals with tax-farming practices in the later Empire makes reference tothe “financial groups of a permanent character” that found capital forthe societas publicanorum which “usually had but a short existence”(Buckland 1963, p.513). This suggests a more complicated legalstructure for tax-farming than envisioned in modern claims of sharetrading.

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seeking to make an equity capital investmBuckland (1963, p.510) deals with the legalitithe situation:

A socius could not, by taking a partner,him to the societas. If he took such a paand allowed him to deal with firm busineswas responsible for his acts, and could norid of liability by ceding his actions aghim. As between its parties, the subpartnewas valid. An actio pro socio on it wouldaffect the main societas, but so far assubpartnership was formed merely in respethe concerns of the principal firm, it necesended if that did.

This provides a legal basis in Roman private law f‘sale’ of shares in the societates publicanorum. Whselling or gifting of shares in a sub-partnershipqualifies as ‘trading’ of shares is debatable. Presum‘trading’ would allow a buyer of shares to then sesame shares, as in a modern stock market. Whatbuyer could only sell back to the original seller,this qualify as ‘share trading’? Liability from a netof sub-partnerships generated by such ‘trade’ in ‘shwould not be limited and the ‘shares’ would hfinite life dependent on the term to maturity (lustruthe contract that the main societas had withcensors.21

Precisely how much ‘up front’ capital was reqto undertake the contracts is relevant to the ‘supp‘shares’ available for trade. The wider financiacredit implications of tax farming activities osocietas publicanorum during the late Republidescribed in Pro lege Manila [vii.19](Hodge,trans.): ‘this system of credit and finance which opeat Rome, in the Forum, is bound up and depend

therces,laterves:f thes areces isethodublic,

21 If a network of partnerships was employed, such practice was nounique to the late Republic. Detailed primary sources for this methoof organizing a capital association are present in the appearance onotarial records that appear starting from the middle of the 12tcentury in Genoa. Prior to this time, primary sources with commerciadetails of capital associations, other than the material in the CairGeniza and Islamic juristic decisions, are scarce. The almost completbusiness records of Francesco Dantini, ‘The Merchant of Pratoexamined by Origo (1957) replicate such a network of partnershipsThere was no trading of shares in these networks. The societas marievidenced in 12th century Genoan notarial records for use in longdistance seaborne trade has similar features, again with no trading oshares.

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of credit and finance’ impacted economic and comcial activity during the late Republic is a sourdebate, e.g., Harris (2006). One extreme in this debrepresented by Badian (1972, p.104) where it is clathe contract system encompassed the senatorial“the public contracts were a regular part – how largcannot tell – of many senatorial incomes”. In conthe prominent Roman historian Frank (1927, p.279attributes limited economic impact to the cosystem:

In the last century of the Republic... not acapital found new outlets, especially in the mament of state contracts, in money lendingbanking, and in trade. The activities and imporof the state contracts are apt to be overestimbecause, having a general interest, and beinconcern of every citizen, they form the topic opolitical harangues and letters of the day... the acapital engaged in public contracts probably direach one per cent. of the amount invested inestate in the city of Rome. Of the tens of milliostate income that we have estimated for Cicero'two-thirds at least did not pass through the hanthe publicans. Asia was the only province thabeen wholly abandoned to them, and in theprovinces like Sicily, Spain, Africa and Gaul,collected only the less lucrative revenues.construction of public works like aqueducts, rand harbors brought profit at times, but such wwere subject to precise estimates of cost andsupervision; the work was almost always welland without the odor of dishonest spoils.

Is it possible for the initial amount of liquid crequired to take up the contracts to be small, as claby Frank, while the revenues, and possible pgenerated by the tax-farming contracts in Asisubstantial?

Despite the considerable attention given to‘contract system’ in numerous secondary souspecific detail of the ‘contracts’ used in theRepublic is lacking. As Kay (2014, p.80) obse“The specific arrangements and obligations opublicani under the contracts to collect Asian taxenot known.” Artful interpretation of available sourrequired. Consistent with the censoria locatio mof auctioning public contracts during the late Rep

tdfhloe’.s- 22 The original Latin is given in the Loeb Classical Library as
f fides atque haec ratio pecuniarum, quae Romae, quae in foro
versatur, implicata est. cum illis pecuniis Asiaticis et cohaeret”.

Malmendier (2005, p.32–3) recognizes “the contracts”)23:

s’ omoson oasedm thtaxemosium)d th

f thiact ose the.g.and

owaf dayrioucatioworky thsuch

t thhowwhatwas

2007,makeublicsible,fixedsocii,ny in

Asia could be low because the assets needed for tax’ byy theility.striand toion, acouldapitalcouldentsistra-d. Inapitalhavetivespital.roniaengthecentsia’,y they thatand

ually.e tax

: “Theus of a

The Roman practice of adopting the tax-collection practicesalready in place in conquered territories meant that, in such cases, thebulk of fixed assets and labor required for tax collection would alreadybe available. This reduces the need for large fixed capital investmentsin revenue collecting assets. Brunt (1956) hints at the details in theimposition of a large direct assessment, approximately five yearsregular vectigal, on the Asian cities by Sulla in 84 BC. Sulla requiredthese funds “principally to finance the impending civil war”. Thisassessment was to be paid in advance. In the collection of thisassessment, “the cities were left to find the sums required forthemselves and that Roman publicans were not used. This need notsurprise us. During Mithradates' invasion of Asia most of the localagents of the Roman companies must have been killed or fled... [thecities] employed publicans as publicans, not as money lenders. These


were legally executed as leases (locatio conductio

The publicans were ‘government leaseholdercontractors with the Roman government.... The(in)famous leases are those [for]... the collectitaxes, tolls, and other dues. The publicani ‘lethe right to collect direct (poll or land) taxes froinhabitants of the provinces and indirect(customs or dues). Cicero lists the threeimportant types of dues: the port tax (portorthe tithe (often referred to as the decuma), anagistment (scriptura).

Giving attention to the commercial implications olegal structure reveals locatio conductio was a contrlease or hire for a price, a double name is used becaurights and duties of the parties are different,Buckland (1963, p.498). As reflected in the sizecomplexity ofDigest [19.2], use of locatio conductia central feature of Roman commerce, e.g., hiring olaborers, leasing of land, renting of dwellings. Vatypes of locatio conductio could be used, e.g., looperiswas used to contract for a completed piece ofand would apply to public works construction bsocietates publicanorum. Legal implications ofcontracts differ across locatio types.

Kay (2014, p.80–1) correctly recognizes thacontracts were ‘fixed price’ but does not identifyand when payments were made. More precisely,amount of initial ‘money’ (pecunia) contributionrequired to undertake a lease contract? Hollander (ch.1) demonstrates the widespread use of credit topayments and the broad definition of late RepRoman pecunia, e.g., Digest [50,178]. It is poswith the use of verbal pledging of substantialassets to secure the contracts in Rome by somecapital investment in the fixed assets of the compa

23 Smith and Marindin (1890) describes the contract systemsystem was simply that of the purchase or lease by a publican
prospective source of revenue, which he farmed at his own risk and fohis own profit.” This suggests that purchase and sale contracts were alsused, likely resulting in a much larger initial payment by the purchaser tacquire rights to farm the revenue source for a set period of years. Irequired due, say, to the local administration having a higher than normaneed for funds, e.g., Sulla in 84 BC, a large up-front payment woullikely be financed on credit. In this case, socii able to source credit in thprovinces would be essential. Legally, however, a lease contract woulbe applicable for almost all vectigalia because the ager publicus coulnot be ‘sold’ even for a period of years (Digest[3,1]). Ownership of mosrevenue producing assets would reside with the state and could not balienated by sale. However, as with the alienation of the ager publicuthat concerned Tiberius Gracchus, it is possible that the Spanish minewere, somehow, privatized by the different Roman administrators (Kay2014, ch.3).
rtf’est,e

sfe,

s

s

e

e

collection in the provinces were already ‘ownedother socii or the cities collecting revenues, not bcompany.24 Jones (1974, p.163) hints at this possibAllowing for the ability of some socii (or equefinanciers) to provide credit at the auction anfacilitate transactions by the provincial administratsmall initial payment upon success at the auctionbe sufficient to take up a tax farming ‘contract’. Cpaid in Rome required to obtain a lease contractbe ‘small’ compared to the regular ‘rent’ paymmade by the publicani to sustain provincial admintion as vectigalia and other revenues were collecteother words, the initial ‘capital’ required for the ‘cassociation’ to obtain the lease contract may notbeen substantial, undermining the pecuniary incenfor socii to enter into sub-partnerships to obtain ca

In addition to fixed prices, under the Lex Sempde provincia Asia (122/3 BC) a fixed contract l(lustrum) of five years was used. Based on the rdiscovery near Ephesus of the ‘Customs Law of AKay (2014, p.80) suggests an annual payment bpublicani of the portoria in Asia.25 It is also likelthe agricultural revenues in Asia, the scripturaespecially the tithes (decumae), would be paid annRecognizing that the Romans may have based som

24

roofldeddtess,

publicans were not Romans but Greeks”. Brunt observes that Cassiusin 43 BC and Antony in 41 BC also demanded taxes in advance. Thereis the distinct possibility based on the overlap of equites that were bothpublicani and money-lenders, if and when sizable taxes were due inadvance, the publicani would lend these funds to the citiesresponsible, earning interest in the process.25 Cottier et al. (2008) provides a detailed examination in Greek,Latin and English of text of the inscription discovered in the Church ofSt. John, near Ephesus, in 1976. The stone bearing the inscription isnow housed in the Archeological Museum of Ephesus. Though theinscription dates from the time of Nero in 62 AD, the text is anaccumulation and aggregation of decisions making reference to taxfarming practices dating to before the reforms of C. Gracchus thattransferred authority for leasing the taxes from the governors to thecensors in Rome.

farming methods in Asia on practice from Sicily, Jones

on inn 212ity byd ths oent, thn thd theacherredrs, tothen

elves

ggeswa

stincwermakAsias. Inth

f thnt, ifoth

aresand

The modern interpretation of the contract systemthe

olvedasorsterna-ollectalson thequireenue,otheratured bydreaualsotradectioncredited inJones

tractsing intationd bypire,ullen,rgelyfricanate.26

y the8th

abālaactice.219).cient


(1974, p.162–3) summarizes that system:

The Romans found the tithe already in operatiSicily... in the kingdom of Syracuse, annexed iBC.... The tithe was sold annually at Syracuse, ccity and crop by crop (wheat, barley, fruit), ancontracts therefore normally went to Sicilianresident Romans, sometimes to city governmthemselves. The key operation was the pactioagreement on the amount of the crop betweecontractor and the cultivator... The law envisagecontractors making a separate pactio withcultivator, but in practice the contractors prefexcept in the case of a few important landownemake a block pactiowith the city authorities, whoassessed the tithe in detail and collected it thems

If as Jones (1974, p.163) and Kay (2014, p.76) suthe Asian decumae introduced by C. Gracchusbased on practices in Sicily, then there is a dipossibility that methods of managing contractsalso adopted. In particular, the publicani could‘block pactio’ with individual city authorities inallowing the cities to then directly collect taxeaddition, there may be different incentives incontracting system for ‘important landowners’.

This interpretation of the possible working ocensoria locatio system uncovers other importaunrecognized, features of the contract systemtax-farming in both the Republic andEmpire relevant to the claim of trading in shOne such feature is recognized by SmithMarindin (1890):

we can distinguish two methods of tax-farmingnd inrectlyn thanuotheiveds ares oed athanrictlyot as4, 12,, theyicani.

d byincesh theg., elon ofpartyn thee rich.221).

of theEmpire tax collection practices were well established, both in Romeand the territories. This situation differed substantively from the lateRepublic where control of the conquered territories was beingestablished and the political situation in Rome was ‘fluid’. In addition:“One cannot, of course, place too much emphasis on legal texts as atrue reflection of actual practices in society” (el Fadl, 1992, p.7).

which were regarded as distinct both in law afact. In one of these the publicanus is not diemployed in working the source of revenue, iother he is; in the one case, therefore, the publicis not the possessor or occupant of the land, orsource of wealth, from which the revenue is derin the other case the possessor and publicanuidentical. It is only to the first of these two classtax-farmers – to those, that is, who are regardcollecting vectigal from possessores otherthemselves – that the name publicanus is stapplied; the latter class are regarded in law npublicani, but as publicanorum loco (Dig. 39,13), although, in the current literature of Romewere, equally with the former class, called publ

erseee

,

.

tstee,

e

efre.

,

esr:efs

becomes decidedly more complicated wheresocietates bidding on the tax-farming contracts invsocii that were also owners (possessores) or le(conductores) of revenue producing property. Altively, the publicani could ‘sub-let’ the right to ctaxes to local authorities, many of which wereproperty owners. In both cases, those socii bidding otax farming contracts in Rome would not reextensive fixed assets for the collection of state revonly the substantial fixed assets needed to pledge oraccess to sufficient security. Another relevant feimportant to the commercial context is identifieBrunt (1956, p.20), Nicolet (1966, 1974) and An(1999) where publicani involved in tax collectionacted in money-lending (foeneratores) and(negotiatores). This suggests a fundamental connebetween those centrally involved in ‘this system ofand finance’ in Rome and the socii directly involvAsian trade, tax collection and money lending, e.g.,(1974, p.118–9), Kay (2014, p.192–3).

Given that specific details of the tax-farming conand contracting system in the late Republic are lackthe available primary sources and that artful interpreis required, some indirect assistance is providesecondary sources on taxes in the Roman Emincluding Roman Egypt (Wallace, 1938; MacM1962; Reiter, 2004) and in later, more detailed and lajuristic, records from the Asian and North Aterritories that came under control of the CaliphUse of such later legal sources is complicated bIslamic juristic view, advanced in the 7th andcenturies, “which typically characterize q(tax-farming) as ribā and as a heinous, corrupt prwhich ought to be forbidden” (Haque, 1975, pPrecisely how qabāla was reconciled with the anlicit system of metayage is carefully examineLokkegaard (1950, p.108) where qabāla in the provof the previous Byzantine empire is equated witlocatio conductio system used by the Romans, e.Fadl (1992, p.8). “Qabāla was a necessary extensimetayage, by which, in general, the element of thirdor middlemen tended to be introduced betweepeasantry and the state. These middlemen often werlandlords and influential men” (Haque, 1975, p

26 Caution is required for a number of reasons. By the end

Contracting methods employed were “used in differentlandes, aed inrs.rectly, thiterings andty for andes orded?tionds ouitesuchble tos ha, e.g.frombemingilityn thofe tax‘gift’ny, ag hidingth

stincodern

umawertomaboue27:

ur osts o

the imperial state had more in common with those oftomsntilistmentn thetheto ahichtoms, andd thethosely.

m thexportbulkuitesoodss andatricklaveslium,ted astradeetatesand

be of

ercialmings ofbject, taxd anilableKayendi-wereation‘city’gularoftenublicenuedivers


combinations” depending on the ownership of theAgain, those responsible for supervising the estatowners or lease holders, were also often involvcollecting rent and taxes from the peasant cultivato

What of the claim that senators directly or indiobtained revenues from the contracts? If correctcould be accomplished indirectly by ensub-partnerships that provided assets to familiareany other amici that such socii could use as securithe contracts. However, if senators such as CaesaVatinius possessed (and traded?) unregistered sharalternatively, were indirectly invested in (and tra‘shares’ through proxies, then what were the motivafor such taking positions? In the economy of frienthe late Republic, wealth for senators and most eqwas intimately connected to landed estates. Whetherestates in the late Republic were sufficiently profitasupport the lavish lifestyles of the Roman upper clasbeen an on-going debates among ancient historiansRosenstein (2008). Perhaps the profits generated‘shares’ in the societates publicanorum wouldtempting pecuniary inducement, even if public shafor such investment by a senator was a possibHowever, in the context of amicita and gratia iRoman economy of friends, profit from a subleasetax farming contract, or a ‘commission’ to superviscollecting in the provinces, could be considered as auseful to the establishment and extension of patrimoreflected in Rab. Post.: “he never ceased enrichinfriends”. Even if there was rudimentary ‘share trathrough gifts of shares in sub-partnerships,non-pecuniary motivation for such trade was difrom the impersonal, profit oriented trading of mstock markets.

In addition to tax farming of the vectigalia (decand scriptura) on the ager publicus, the publicanialso responsible for collection of the portoria (cusduty). Bang (2008, p.213) provides some insightthe taxation process for portoria during the Empir

If legal regulations were heavily tilted in favothe customs officials, it was because the intere

27 As Kay (2014, ch.3) demonstrates, there are a number of

orkssses”tatess officanturinglittle

opinions on the role of the publicani in the exploitation of the Spanismines. Any such participation would be earlier, Livy indicates, perhapas early as 214 BC, more likely in 195 BC when “Cato institutevectigalia magna, and some kind of process for collecting them mushave been introduced at the same time.” In contrast to Frank, Richardso(1976) argues that the societas publicanorum played a limited role iexploitation of the Spanish mines. In any event, there is no reference tmining activities of the societas publicanorum in the primary sourcerelevant to claims of share trading.

.s

s

r

,)sfs

s,

a

.ea

,ss’et

eest

ff

the tax collectors than of the merchants. Cusduties were not, as they later became in mercastrategies, an important tool which the governused to shape and promote economic activity iempire. The main interest of the state inextraction of customs was fiscal. Trade waslarge extent viewed as a flow of resources wcould be tapped for the sake of revenue... Cuswere not something mainly charged on exportsespecially imports... the imperial systems taxeinternal movement of goods as well as ofcrossing their boundaries almost indiscriminate

As the Republic evolved, agricultural production frolanded estates increasingly aimed at inter-regional etrade, rather than local consumption – especially thegoods, wine and olive oil. Senators and wealthy eqwere also substantial consumers of the imported gthat were obtained in exchange for these bulk goodspecie generated by territorial expansion, e.g., Fitzp(2011). As such, through independent proxies or sand children in potestate, endowed with a pecusenators and wealthy equites in the late Republic acnegotiatores, heavily involved in the movement andof goods. Direct or indirect participation in sociresponsible for assessing and collecting customsother taxes on the movement of goods wouldconsiderable value in assisting this trade.

The final essential element of the commcontext to consider is the size, type, location and tiof public expenditures. Given the uncertaintierevenue collection in largely agrarian societies suto the vagaries of weather, war and pestilencefarming contracts with fixed prices provideassurance to the state that revenues would be avawhen needed for required expenditures, e.g.,(2014, p.80–1). The different types of public exptures varied in size and timing. Regular paymentsrequired to sustain the Roman provincial administrand, where applicable, the associated non-Romanadministration. There were also regular and irrepayments to sustain the military; and, irregular,sizable, expenditures for the construction of pworks. The commercial connection between revcollection, trade, money lending and public wconstruction activities of equites and other “clainvolved directly and indirectly with the sociepublicanorum is undeveloped in modern claimshare trading. The publicani that played a signifunctional role in funding public expenditures dthe late Republic were difficult to displace and had

ehsdtnnos

incentive to trade ‘shares’ to raise equity capital. Undersponiture

piris thrs ind itpir

ychoh thand

m, i

undees ins thay ththes

tate

(1972), there were a number of earlier scholars thatwith858).renchncingenceThetzeffange

haresthat:the

tion”ted in

cateded asomicmorenomy


the Empire, local authorities assumed increased resibility for tax collection and public expend(MacMullen, 1959, p.207):

Of the many things that separate the Roman Emfrom the Republic, the most obvious physicallybuilding activity of Augustus and his successothe provinces. The Republic had embellishecapital at the expense of the conquered; the Emredressed the balance; and the political and pslogical significance of this change, by whicwealth of Rome's subjects was in part,sometimes very magnificently, restored to thesufficient to mark an era.

The process of funding public works constructionthe Empire was facilitated by fundamental changthe method of collecting revenues under Augustucurtailed the control of the provincial fiscus bpublicani.28 Claims for share trading afterchanges are muted.

4. Modern claims for trading of Socie

re thg ods one isth thrmanHalmand

oum). Inhavadian

e, thef thetion”ch asublicanderstatetionalres)”., thissoci-

andgree-legalthat

Publicanorum shares

Given the commercial and legal context, what aimplications for the claim that there was tradinshares in the societates publicanorum? This depenthe strength, timing and details of the claim. Therlong lineage to claims of share trading, starting wiinitial interpretation of Vat. by the important Gephilologist Karl Orelli (1835), expanded in(1845). Ancient historians that later adoptedembellished this interpretation include Del(1890), Kniep (1896) and Rostovtzeff (1902contrast to largely undisputed modern claims thatbeen inspired by the ‘maximalist’ position of B

28

pora-t dealrate’ality’ple-–50)al orThe

tractsplacerket”.ts by

Brunt (1956) discusses the development of the fiscus and thdifferent meanings for this word. Under the Principate, the fiscucould mean ‘the private funds of the emperor’ or, more broadly, ‘thwhole financial administration controlled by the emperor’. Suchmeaning was not possible during the late Republic. As for fundinpublic expenditures during the Empire (MacMullen, 1959, p.210“Every possible kind of arrangement was made to see that funds ocredit were transferred. No doubt the easiest was a warrant to drawfrom the fiscus of the province as it was filled up with taxes... Asidfrom outright grants [from the imperial treasury], money for buildinwas made available in the provinces through the juggling of taxessometimes by crediting taxes to municipalities, sometimes bauthorizing new taxes on their behalf.” This ‘juggling’ of taxes woulhave been difficult under the contracting system used in the latRepublic.

-s

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se-e

s

r

tee

s

ef

ae

e

e

disputed claims of share trading originatingOrelli's interpretation of Vat., e.g., Long (1Significantly, in identifying ‘partes’ with the Factions of the early 19th century, Orelli is refereshares in joint stock companies prior to the emergof the general limited liability corporation.contributions of Deloume, Kniep and Rostovappear after the emergence of widespread exchtrading of shares in limited liability corporations.

Modern ‘maximalist’ claims of trading in sreceive essential support from the additional claim“The societas publicanorum had thus assumedmost important features of the modern corpora(Malmendier, 2009, p.1089). This support is reflecthe claims of Malmendier (2009, p.1079) about:

how an early economy could be sophistienough to generate a business form as advancthe societas publicanorum.... Rome's econinstitutions during the Early Empire weremarket-oriented than even in the medieval ecomany centuries later.

Similarly: “From a practical, economic perspectivhistorical sources paint a compelling picture osocietas publicanorum as the first business corpora(ibid, p.1090). In contrast, ancient historians suBadian (1972) are more cautious, referring to ‘pcompanies’ instead of ‘corporations’. In turn, Holl(2007, p.49) states: “corporations involved in thecontracts... raised capital not through tradiborrowing but through the sale of partes (shaWhile claiming corporate status for the societatesperspective only identifies the “sale” of shares asated with an initial raising of capital.

The strong, maximalist views of BadianMalmendier on share trading are tempered by disament over corporate status. Much discussion byand economic historians is dedicated to the claimthe societates publicanorum functioned as ‘cortions’. While the issue of corporate status does nodirectly with share trading, the modern ‘corpoproperties of limited liability and legal ‘personindependent of the shareholders are beneficial comments to share trading. As Silver (2007, p.49claims: “There would be no insuperable institutioncultural barrier to a functioning stock market...structure of the market for government conoffers testimony...corporations were common(not rare) and may well have dominated this maSuch claims give support to exaggerated statemen

eseag):r

eg,yde

the influential legal historians Hansmann et al. (2006,rgesd thwithrtnerto

noCapis:

therld bfromvenore

atorsr andthou

anyfromorianspecto b

werhoshareof thhareregisodern

urcewith972)th

g oh tohichstock

ppormadadian

We have one cardinal reference... which is soxtortartly. Vat.h wence I

thed ofin 59emis-suchthe

them;r and

ding,tzeffand

maryed byfirsturce]lier”.ationnturytremeian ismpa-anies

n thedoes

m totheytiniuse notradedouldh weteredertainm ofd by

ucedurces1972,lican

ection


p.1361): “By the first century B.C., the lasocietates publicanorum appear to have resemblemodern public company in both size and structure,‘multitudes’ - presumably hundreds - of limited pawho could trade their shares on a market similarmodern stock exchange”.

Maximalist claims for trading of shares arerestricted to ‘modernists’. Exploring the ‘Ancienttalism’ of Max Weber, Love (1991, p.140) observe

Apparently, shares (partes) existed for whichwas a kind of market value; such shares couacquired either directly from the company orone who already owned them, and there was ekind of stock exchange jargon in use. What is mit seems to have been a matter of course for senincluding such eminent individuals as CaesaCassius, to trade in this unregistered ‘stock’ witheir ever becoming actual socii.

Being an ancient historian, Love refers to ‘the compinstead of ‘the corporation’. Working largelysecondary sources, the widely cited economic histChancellor (1999, p.4–5) takes a maximalist pertive on share trading and finds the societates‘modern joint-stock companies’:

Like modern joint-stock companies, the publicanilegal bodies independent of their members wownership was divided into partes, or shares... Scame in two sorts: larger executive shareholdingsgreat capitalists, known as socii, and smaller scalled particulae. The manner of dealing in untered particulae was informal, resembling the mover-the-counter stock markets.

While Chancellor does reference some primary so– Polybius [vi 17] and Curculio by Plautus – asLove, primary support is by reference to Badian (1which is identified as the definitive work onpublicani.29 Despite the strong claim for tradinshares, Chancellor (1999, p.5) is careful enougrecognize: “No evidence remains of the prices for wpartes were sold, and there are no descriptions ofmarket behavior”.

Given the repeated references to Badian as sufor the strong maximalist claims, the situation ismore confusing by the actual position taken in B(1972, p.102):

29 ‘Definitive’ is due to the singular attention to the pubBroadening the subject matter to equites, with significant s

to thethe

dealing with the publicani, admits ‘definitive’ sources such as the twvolume Nicolet (1966, 1974).

te

sa

t-

ee

a,,

t

’

-e

eeses-

s

,ef

te

important it must be quoted in full: ‘Did you eshares, which were at their dearest at that time, pfrom Caesar, partly from the publicani?’ [Cic29] This shows us various things, none of whiccould have suspected from any other evideknow: that there were shares (partes) incompanies, which appear to have had a kinmarket quotation (there were high in value[BC], because the tax-farmers' request for a rsion of one third was granted in that year); thatshares could be bought either directly fromcompany or from one who already heldfinally, and most surprisingly, that both Caesa(later) Vatinius held such shares.

Addressing earlier contributions on share traBadian (1972, p.102) explicitly states that Rostov“exaggerated” claims of stock market tradingquestions the support for such practices in the priliterature. Badian also questions the time frame usRostovtzeff: “that this developed in the second andcenturies B.C., although in fact [the primary soonly refers to 59 [BC] and we have nothing earPresumably, Rostovtzeff is confounding informfrom Polybius with that from Cicero almost a celater. Making numerous references to “the exdearth of information” in the primary sources, Badcareful to only make reference to “the public conies”, without delving into whether these compapproximated modern corporations.

Despite making a number of qualifications, oissue of trading shares Badian (1972, p.103)concur with Rostovtzeff on key points:

The shares owned by Caesar and Vatinius seehave been in a different category. The fact thathad a variable quotation and the fact the Vaextorted them from Caesar suggest that they werthe regular subscriptions of a socius, but shares t‘over the counter’ as Rostovtzeff thought... I wsuggest that the shares traded in 59, about whicget our incidental information, were unregisshares... technically very convenient (as in cmodern analogues) where the maximum freedotrading is wanted both by the company itself anthose buying a financial interest in it.

These inferences – not “facts” – are, again, dedfrom Vat. This begs the question: what other sodoes Badian provide for these claims? Badian (p. 7) explicitly acknowledges an intellectual debt“short, but stimulating and scholarly paper” by

i.so

ancient historian Brunt (1962) on the equites in the latecated, tho thstemf th

ndertal toed byrestsrallyd thon oicanmerthessistedh thainedtes and ipres.

e wamitedf there ireat; and

urce

erciamaryhichencet. andf Vatomircesn th

importance and methods of tax-farming. The mainmaryercialrum?therecientdirecttered,adingregis-nsureearlyod ofocess

ecog-oderns andd theed inurcesinionriouspearsf thisg. Inthe

ourceishedt dealercialk onweense ofsharenerals. Inshare

s ofand

n thee.g.,rawsd bym isietate


Republic. This reference raises subtle and compliissues surrounding differences between equitespublicani and the ‘officer class’ that are relevant tpolitical and judicial aspects of the contract syduring the late Republic. On the activities opublicans, Brunt (1962, p.123–4) observes:

The importance of the publicans is easy to ustand. They performed functions that were vithe State and from which senators were debarrlaw. Senators had to take account of their intebut did not share them. The large profits natuattracted the richest of the non-senators ancapital required was so great that the co-operatimany such men was indispensable. The publalso formed joint-stock companies in which nuous investors could take shares and thoughcompanies were not permanent in law but subonly to fulfill contracts let every five years, mucsame group of socii may usually have obtrenewals of the right to farm taxes... The Equisuch had no effective corporate organization, awas these companies which were deemed to exthe common sentiments of the order as a whole

Instead of trade in shares, Brunt indicates that therstability in the shareholder base, implying a liscope for trading, at best. No mention is made oparticipation of senators or trading in shares but ththe common claim that: the capital required was ‘gand required the cooperation of “many such men”‘the publicans formed joint-stock companies’.30

5. Translations and interpretations of primary so

A claim for better understanding of the command legal context requires validation in the prisources. The most important primary source from wBadian, Malmendier and others draw strong inferabout share trading is Vat. Secondarily, Rab. PosVal. Max. are given to support the interpretation oand the availability of traded shares in small dennations, i.e., particulae.31 In addition to these souPro lege Manilia is also examined for detail o

30 Richardson (1994, p.584) also observes: “the soc
atin.rtant1926,artesicani,Rab.
publicanorum... made up of a number of stockholders, and in manways similar to modern joint-stock companies”.31 The other two parts of Vat. referenced by Badian, Vat.[12.13] an[12.15], are not concerned with share trading. Vat.[12.13] referencethe insidious collection activities of the publicani of the late RepublicVat.[12.15] deals with Cicero seeking to attack Vatinius without alsbringing shame on Caesar, his sponsor.

ee

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s

.-,e

questions to be addressed in examining these prisources are: what were the legal and commcharacteristics of shares in the societates publicanoAnd, were shares ‘traded’, in some sense? Thatwere ‘shares’ is not in dispute, there is ample anevidence on this point. In addition, there is noevidence on whether and how shares were registhough claims by Badian and others of senators trunregistered shares implies some shares weretered. The practice of pledging assets to efulfillment of consensual contracts, identified asas Polybius [vi 17], strongly suggests some methregistration, though there is no evidence on the prinvolved.

Any examination of primary sources has to rnize the philological processes that led to the meditions of the ancient texts. A variety of opinioninterpretations over several centuries have impactetranslations that have become generally acceptmodern times. Where there is ‘corruption’ in the soused to recreate the ancient texts, divergence of opis difficult to avoid. As evidenced in the vaavailable Latin sources and translations, this apto be the case with Vat., reducing the strength oessential primary source for claims of share tradinaddition to philological issues associated withimperfect text, the strength of Vat. as a primary sfor modern claims of ‘share trading’ is diminbecause, among the various orations of Cicero thain some sense with issues related to commactivities, Vat. is not well situated. The attacVatinius is a complicated political interplay betCicero and Caesar arising out of Cicero's defenSestius. The very brief possible reference to ‘trading’ relates to a specific claim in a more gecharge of extortion and corruption against Vatiniuessence, the historical context for the claim oftrading given in Vat. is indirect and weak, at best.

Repeated references to Vat., central to the claimsharing trading made by Badian, Malmendierothers, employ the English translation provided iLoeb Classical Library by Gardiner (1958),Hollander (2007, p.49). In turn, this translation dheavily on Pocock (1926), a source also useBadian. The Halm (1845) edition of In Vatiniureferenced by Pocock as the source of the original LWithout referencing the specific work of the impoearly 19th century philologist K. Orelli, Pocock (p.116) claims: “Orelli's view that partes = ‘ppublicorum’, shares in the joint stock of the publis alone satisfactory, and is generally accepted (cf.

sy

ds.o

Post. 2.4; Val. Max. 6.9.7)”. Gardiner (1958, p.279, n.h)

mingth

pricr thiuredaesaendix

merficanld bte inmingon otaks noift osub-ietaort inding

r ares byn thy thcock

et itwiths oortedr and

sub; thifromcouldon orhares

could be “very valuable” because the revenues from theue torablen ofthatwithat. is

tationlation

thers,wishyoureatiesyouDidwerem theyou

ich inwas

standof usiend,en toyou

being

ously. Theas:

tim asamepartes?).tal ofdinerf the

The Latin version given by Gardiner (1958):XII. Et quoniampecunias aliorum despicis, de tuis divitiis intolerantissime gloriaris,volo, uti mihi respondeas, fecerisne foedera tribunus pl. cumcivitatibus, cum regibus, cum tetrarchis,[?] erogarisne pecunias exaerario tuis legibus,[?] eripuerisne partis illo tempore carissimas


adapts this position and expands:

Partes = shares in the capital of a tax-farcompany. Vatinius secured a remission topublicani of one-third of the original purchaseof the Asian tax-contract. His commission foservice was paid in gifts of shares in the favocompany, greatly appreciated in value, from Cand the company. See Pocock (1926, Appiv.C)”.

This translation for partes suggests a specific comcial context, i.e., that the contracts required signiamounts of “capital”, that shares in the capital cou‘paid as gifts’, and that shares could ‘appreciavalue’. However, ‘shares in the revenue of a tax-farsocietas’ could be a more consistent interpretatithe commercial context if initial capital needed toup the locatio conductio contracts (for hire) walarge. Even if significant capital was required, a ‘gpartes’ could mean a ‘gift of shares in a (partnership with a socius participating in a socvectigalium’. In any event, there is no direct suppeither the Pocock or Gardiner translations for ‘traof such shares.

Is it possible that both Pocock and Gardineindirectly suggesting that there was trading in sharmaking reference to “joint stock” and “shares icapital”? Such a suggestion is not supported b“summary of the argument” in Vat. given by Po(1926, p.50):32

You boast of your great wealth. How did you gAs tribune of the people you made great treatiesthe peoples of the East; you drafted vast summoney from the treasury by your laws; you extshares, very valuable at that time, from Caesafrom the Publicani.

The ‘extorted shares’ in this case could be forpartnerships or for revenues from the vectigaliagives no indication of tradeable shares. The sharesCaesar, instead of tradeable unregistered shares,refer to state revenues to be paid to his administratiotherwise under his control as possessor. These s

32 Pocock (1926, p.v) claims, incorrectly, to be the first “Englisedition of the ‘In Vatinium’” since G.W. Long (1858), “a much largework” that “is not exhaustive”. In addition, Pocock (1926, Appendiiv.C) is subtitled “eripuerisne partes illo tempore carissimas partimCaesare, partim a publicanis?” However, no discussion or reference igiven in Appendix iv.C to the trading of shares or why ‘partes’ is usein lieu of ‘partis’ so the reference in Gardiner is insufficient.

ees

r

-te

fetf)s

’

e

ee

?

f

-s

contracts at the time could have been significant da period of ‘serenity and stability’ and favoharvests or, as often stated, because of remissiocertain contracts by the Senate. An interpretationthere was senatorial trading of unregistered shares‘high prices’ based on this brief passage in Vquestionable, at best.

To appreciate the translation and interpreissues involved in Vat., consider the English transof Vat. by Gardiner given as:33

XII. And since you so despise the wealth of owhile you boast immoderately of your own, Iyou to answer me this question. Duringtribunate of the commons, did you not make trwith states, with kings, with tetrarchs? Diddisperse sums from the treasury by your laws?you not at the same time filch shares when theyat their highest, in part from Caesar, in part frotax-farmers themselves?[*] This being so, I askwhether, after being so poor man, you became rthat same very year in which a most severe lawpassed against extortion? that all may underthat you treated with contempt not only the actsyou call tyrants, but also the law of your best frto whom you are in the habit of slandering evus, who are his greatest friends, and whomgrievously insult whenever you boast ofconnected with him.

At [*], Gardiner provides the note given previabout the definition of partes adapted from Pocockkey section from the original Latin is given“eripuerisne partis illo tempore carissimas parCaesare, partim a publicanis” (Did you not at thetime filch shares when they were at their highest, infrom Caesar, in part from the tax-farmers themselvIn translating this key section as shares in the capia (joint stock) company, Pocock (1926) and Gar(1958) do not concur with the stated view o

33

hrxasd

partim a Caesare, partim a publicanis.[?] Quae cum ita sint, quaeroex te, sisne ex pauperrimo dives factus illo ipso anno, quo lex lata est.de pecuniis repetundis acerrima, ut omnes intellegere possent a te nonmodo nostra acta, quos tyrannos vocas, sed etiam amicissimi tuilegem esse contemptam; apud quem tu etiam nos criminari soles, quiilli sumus amicissimi, cum tu ei contumeliosissime totiens male dicas,quotiens te illi adfinem esse dicis.

eminent Latin scholar Long (1858, p.24) on this most

is thstandice ipporght inrum’lican; andto b), andan age i; and

late). IntationiginaHalmovidcriptndingt.Rabrting845).193as and “in. andates.t. by

neveatureholdrentawerrisestiont thlarg; bug hiswingh andy his

generosity as well as by his magnanimity he

h the886):

intoublicnsac-votedreadyverynever

onracts;th his

e.g.,ublicvidedivinguponw ‘awerethingares.for

urtiusthoutietasns ofthatd inres).wereerentever,iceropportdoubten inguamsiamncedtionsn the

oricianand historian, known in modern times for a collection of historicalanecdotes that was popular in teaching rhetoric in the Middle Ages.Though little is known about the personal life of Valerius, there isevidence he was best known during the reign of Tiberius (14 AD to37 AD) placing his contributions after the late Republic.


essential part of the Vat. translation:

partes... carissimas] This is obscure; and if itgenuine text, we must be content not to underit. The only attempt at explanation worth notOrelli's, but we want historical evidence to suit. Halm concludes that Orelli is at least so far riinterpreting ‘partes’ to be ‘partes publicano‘partes’ of the ‘vectigalia’, which the Pubfarmed; and he refers to Pro Rabirio Post c.2to Valerius Maximus vi.9.7 Orelli takes ‘partes’shares (the French, ‘actions’, the Italian ‘azioni’these shares would be higher at some times thothers. The general meaning of Cicero's charthat Vatinius cheated Caesar and the Publicanithat is all that we can conclude.

Similar cautious conclusions can also be found insources, e.g., Monro (1902), Buckland (1963addition to not agreeing with the precise interpreof the translation by Pocock, Long suggests the ortext for this essential phase may be corrupted.(1845, p.22) and Orelli (1835, p.20) also previdence of differences in medieval manusproviding the different Latin sources for Vat., lefurther support for the possibility of corrupted tex

Context is also fundamental to the translation ofPost. and Val. Max. that are provided as suppoprimary sources for the translations in Halm (1Long (1858) and Pocock (1926). Kay (2014, precognizes that C. Rabirius Curtius Postumus wagent of Pompey, engaged in money-lending anoverseas commerce with his own cargo fleet..produced wine and oil for export from his own estGiven this, the English translations of Rab. PosWatts (1931) in the Loeb edition provides:

My client was his son; and although he hadseen his father, under the potent guidance of nand the influence of constant talks in the houscircle he was led to model himself after the papattern. His business interests and contractsextensive; he held many shares in state enterpnations had him for a creditor; his transaccovered many provinces; he put himself adisposal even of kings. He had previously lentsums of money to this very king of Alexandriain the midst of all this he never ceased enrichinfriends; sending them upon commissions, bestoshares upon them, advancing them by his wealtsupporting them by his credit. In short, b

e

st

,i

e

ts

r

l

es

.

,)

”

re

le;seet

reproduced the life and habits of his father.

Comparing the key section of this translation witsomewhat different earlier translation by Yonge (1

... He engaged in extensive business. He enteredmany contracts. He took a great share of the prevenues. He trusted different nations. His trations spread over many provinces. He dehimself also to the service of kings. He had alpreviously lent a large sum of money to thisking of Alexandria; and in the meantime heceased enriching his friends; sending themcommissions; giving them a share in his contincreasing their estates or supporting them wicredit...

Despite the subtle differences in translation,“shares in state enterprises” versus “share of the prevenues”, the essential commercial context is proby “he never ceased enriching his friends” by “gthem a share in his contracts”/“bestowing sharesthem”, e.g., Rauh (1986). Though precisely hoshare in his contracts’ was given or ‘sharesbestowed’ is not known, yet again, there is nosubstantive in Rab.Post. to support the trading of shEmploying a ‘sub-partnership’ legal contextbestowing or giving shares by C. Rabirius CPostumus – which is done on his own authority withe apparent approval of other socii in the socpublicanorum – is consistent with both translatiothe Latin text. In addition, this section confirmspublicani involved in tax collection also actemoney-lending (foeneratores) and trade (negotiato

In contrast to Rab. Post. and Vat. thatcontributed by Cicero, Val. Max. is from a diffauthor and a somewhat later time period.34 HowValerius Maximus was known to borrow from Cand did construct historical anecdotes to surhetorical style, so there is no a priori reason tothe veracity of the relevant discussion briefly givVal. Max.: “T. Aufidius, cum Asiatici publici exiadmodum particulam habuisset, postea totam Aproconsulari imperio obtinuit”. This text is refereto support the trading of shares in small denomina(particulae). The Bailey (2000, p.87) translation i

34 Valerius Maximus (c.20 BC–c.AD 50) was a Roman rhet

Loeb Classical Library edition is: “T. Aufidius, whotax

witheabllacedOnLatinth

istricers”ndedcasemeansiblyd. Ataxeway

eabl, thistatg thth

ar totraston oentareath

ethodneran o950

gulang oo thort ounce o

epensharg’ of ano bonatcius,erentnd ine for

trading of shares, large or small, is provided in the brief

fromf thewithCice-lege

e and6.16]Asia:ltibusodiis,odgessicalis theintaind thewerectorsnues’intlytateswithe.g.,

pany,

tates7] isglishnt35:

istin-erredince,yourt ourthenclassother

legeines

uibusn ea.ore-

y and

i atqueornatissimi, suas rationes et copias in illam provinciam contulerunt,quorum ipsorum per se res et fortunae vobis curae esse debent.Eteium, si vectigalia nervos esse rei publicae semper duximus, cumcerte ordinem, qui exercet illa, firmamentum ceterorum odinum recteesse dicemus.


had shared in a very small way in the Asiancontracts later governed the whole of Asiaproconsular authority”. An interpretation as ‘tradshares with small denominations’ seems mispcompared to other possible plausible alternatives.such alternative is reflected in the English-dictionary of Young (1810) which providesfollowing definition for ‘partes’: “a division or dwherein customs was taken by the public farmBased on this definition, ‘shares’ (partes) correspoto locations where revenue was collected. In this“giving them a share in his contracts” wouldallocating a location for collection of revenue, posthrough a sub-partnership, though this is not statesuch, a small area allocated or sub-let to collectwould involve T. Aufidius ‘sharing in a very smallin the tax contracts.

If the commercial context did involve tradpartes in the capital of a joint stock companyseems to imply that the ‘company’ collectedrevenues from tithes, customs or grazing, deductinrequired payments to the state and distributingremaining profit pro rata to shareholders, simildividend payments of modern corporations. In consocii could be individually responsible for collectitax within a certain area and making state paymrequired for that area. Allocations of tax collectionto individual socii could be determined whensocietas was formed or determined through the mof auctioning contracts, as in Sicily. This geinterpretation conforms with the basic descriptio9th century tax farming in Egypt by Lokkegaard (1and el Fadl (1992, p.9):

In Egypt, the tax farms were distributed at reauctions... Large areas of land, often constitutiseveral villages or provinces, were delegated ttax management of an individual who paid a squit claim due to the state. The state would renomost interests in administering the provincdistrict.

In this fashion, each shareholder could act inddently of the other shareholders and ‘selling’ awould not directly involve the company. ‘Tradinshares would reflect the gifting or subletting oindividualized tax revenue stream that had tcollected. The liability for non-collection or extorticollection in this transaction would be with the sonot the societas, an interpretation that is much diffthan the ‘stock exchange trading’ interpretation foumaximalist sources. In any event, no direct evidenc

e

e

et.

,

ss’

eseee

,fsse

lf)

rfefer

-ef

ee

Val. Max. passage.There are other primary sources, especially

Cicero, that provide detail on the workings osocietates publicanorum without dealing directlyshares and shareholding. In particular, M. Tullironis de Imperio. Pompei Ad Quirites Oration (ProManilia) has detailed discussion on the importancmethods of tax-farming. Pro lege Manilia [describes the extent of tax-farming activities in“cum publicani familias maximas, quas in sahabient, quas in agri, quas in portibus atque custmagno periculo se habere arbitrentur?” The H(1927) translation for this passage in the Loeb ClaLibrary is: “when the tax-farmers feel that theregravest risk in keeping large staffs which they maon the pastures and the corn lands, at the harbors ancoastguard stations”. Whether the ‘large staffs’composed of salaried freedmen or other sub-contrapaid by ‘the company’ or, alternatively, ‘great retiwere composed of slaves owned individually or joby socii is relevant to the claim that the sociepublicanorum functioned as modern ‘corporations’tradeable shares. Relevant sections of the Digest,[39,4], strongly suggest individual, not comownership of assets.

Another insight into the workings of the sociepublicanorum provided by Pro lege Manilia [7.1the description of the publicani. The various Entranslations for this passage are in general agreeme

‘For in the first place the honourable and dguished men who farm our revenues have transftheir business and their resources to that provand their interests and fortunes ought to beconcern. For if we have always held tharevenues are the sinew of the commonwealth,we shall assuredly be right in saying that thewhich farms the revenues is the mainstay of theclasses.’

This is followed by a revealing passage, ProManilia [vii.18]: “Deinde ex ceteris ordinibus homgnavi atque industrii partim in Asia negotiantur, qvos absentibus consulere debetis, partim eorum iprovincia pecunias magnas collocatas habent.” (Mover, of those other classes there are men of energ

35 The Latin version is:Nam et publicani, homines honestissim

industry who are some of them personally engaged inerestsumbeing, i.e.‘vasthossiblyuitesatorn and

therorumoderner inrthefirsneedproxf thin thn os th, thwert thturedapitalvinglegas noodernededsociidingficulsuch

timeinceon tootheed tore omosnizausedrs o

such resources, not the corporate ‘personality’ of thein a

l andmain) thentractrk ofhad

l taxthanng atuiteste inps, asof aewalsharerictednd insale’ercialealednever

World,ress.nomic

Press,

gs and

ournal

TradePress,

7–25.. (Ed.),ix-en-bridge

stus toe UK.ors and. 235.

evenueState.

nancial

Law of


business in Asia, and you ought to consult their intin their absence; while others of them have vastinvested in that province.) Either Cicero isdisingenuous, or it is only a particular ‘class’equites, that farm the tax revenue. Those that havesums invested in that province’ belong to one of ‘other classes’, especially senators and, posmercatores and money lenders that were not eqAs such, trading of ‘unregistered’ shares by sensuch as Caesar and Vatinius, as claimed by Badiaothers, is inconsistent with this passage.

6. Conclusions

This paper examines the specific question: wastrading in shares of the societates publican(partes) during the late Republic? All but a few msources that explicitly consider this question answthe affirmative, with the strongest claims fumaintaining the societas publicanorum was “themodern business corporation”. Recognizing thefor ‘artful’ interpretation of primary sources to apimate ‘the ancient reality’, closer inspection osurprisingly few relevant sources for tax farminglate Republic reveals only ‘fanciful’ interpretatio‘share trading’ that does not adequately addrescommercial and legal context. For exampleassumption that massive amounts of capitalneeded to ‘purchase’ tax farming contracts aauctions loses validity if the contracts were strucas leases with small up-front payment. When cwas required, a network of sub-partnerships invosocii in the main societas was the appropriateapproach. The use of such private partnerships doesupport claims of share trading similar to a mstock market. As for the fixed (not liquid) assets neto secure contracts at the auction, ‘shares’ for thoseverbally pledging Roman assets or otherwise provsecurity to ensure contract fulfillment would be difto trade, if only because contracts would requiresocii to be legally identified.

The primary sources confirm that, oversignificant capital investment in the Asian provwas necessary to maintain and secure an organizaticollect the various rents, tithes, customs duties andstate revenue that the publicani could be taskcollect during the late Republic. The Asian taxes acentral interest because these provinces were‘profitable’. Though some joint ownership of orgational assets by socii is evident – including slavesas tax collectors – the individual socii were owne

ss

,te,.s

e

rt

-eefeeee

l

lt

i

t

,s

r

ft-

f

societas. Instead of buying and selling of ‘sharessocietas publicanorum’ (partes), the commercialegal context suggests that individual socii in thesocietas would effectively gift or ‘sublet’ (sharevectigalia associated with a given tax farming coto familiares and other amici using a netwosub-partnerships. As such, shares of socii thatsubstantial provincial assets needed for locacollection and money lending would be moredifficult to trade. The requirement that socii biddicensoria locatio auctions be Roman citizens and eqfurther restricts those eligible to legally participathe consensual locatio conductio contracts. PerhaBrunt observes, there was some reorganizationparticular societas when a contract was up for renat the end of the lustrum; however, any such ‘trading’ in the main societas would be highly restand contrary to the claims of share trading foumodern sources. If shares were available ‘forthrough sub-partnerships, the essential commcontext motivating the supply of ‘shares’ is revby Cicero in Pro C. Rabiro Postumo [2.4]: “heceased enriching his friends”.

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trading of shares in the societates publicanorum?

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