Artisans, Retailers, and Credit Transactions in the Roman World

Abstract

In this article, I argue not just that many artisans and retailers in the Roman world were able to finance their businesses only by relying heavily on access to credit, but also that they depended primarily upon trade credit—that is, upon interpersonal credit provided to them by suppliers and subcontractors to whom they were linked by relationships of trust, and from whom they purchased goods and services on account. This was true primarily because most artisans and retailers catered to clients who often lacked ready money when they made purchases, and thus found it necessary to offer shop credit instead of concluding sales in exchange for immediate cash payments. This strategy in turn exacerbated their own cash flow problems and compelled them to incur liabilities that could easily match or exceed the value of their tangible assets. In these circumstances, many found that trade credit was both more accessible than loans procured on the credit market (for which they often lacked the necessary collateral), and also less risky, since suppliers of trade credit could be more forgiving of missed payments than conventional lenders (who were likely to take actions that could result either in seizure of an entrepreneur’s collateral or in his or her insolvency).