How did Persian Trade Work in Ancient Times?
By a combination of large-scale redistribution through the state, market exchange in the cities and towns, and long-distance trade along the royal roads and the Silk Road. The ancient Persian economy is documented in a wide range of textual and archaeological sources, including the Persepolis Fortification Tablets, the Sasanian sahn archive, the Sogdian merchant letters, and the Greek and Latin accounts of the Achaemenid, Parthian, and Sasanian economies. D. T. Potts’s The Arabian Gulf in Antiquity (1990) and his chapter in the Oxford Handbook of Ancient Iran (2013) are the working references for the Iranian side. For the Sasanian material, the work of Daryaee and the recent Encyclopaedia Iranica entries are the standard. The cluster on the Silk Road and the Persian Gulf trade give the longer-distance context; the long-tail here is the everyday mechanism of exchange.
The cities and the markets
The cities of the Persian world were the principal nodes of the trade. The great cities of the Achaemenid empire — Susa, Babylon, Ecbatana, Persepolis, Sardis, Memphis, and Bactra — were major commercial centres, each with its own market, its own merchants, and its own specialisation. The Sasanian cities of Ctesiphon, Bishapur, Rayy, Isfahan, and Merv continued the tradition, and the Islamic cities of Baghdad, Isfahan, Nishapur, and Bukhara, which succeeded them, were the major commercial centres of the medieval Islamic world.
The market, the bazaar in later Persian, was the principal commercial institution of the cities. The bazaar was typically organised by trade, with separate sections for textiles, metalwork, jewellery, foodstuffs, and other commodities. The bazaar was supervised by a muhtasib, or market inspector, who was responsible for the enforcement of weights and measures, the prevention of fraud, and the maintenance of public order. The bazaar was also a major social institution, with the merchant guilds playing an important role in the life of the city.
The Achaemenid, Parthian, and Sasanian cities were also major centres of craft production. The Persepolis Fortification Tablets, the great archive of the Achaemenid administration, document the production of food, textiles, metalwork, and other commodities in the workshops of the empire. Matthew Stolper’s Entrepreneurs and Empire (1985) and his subsequent publications are the indispensable references for the Persepolis archives. The Sasanian cities of Bishapur and Ctesiphon were major centres of silk and silver production, and the Sasanian silk monopoly of the sixth century was a major element of the imperial economy.
Weights and measures
The Persian state maintained a sophisticated system of weights and measures, derived in part from the Mesopotamian and Egyptian traditions and in part from the Greek and Indian. The principal unit of weight was the talent, equal to about 25–30 kilograms in the Achaemenid period, although the exact weight varied in different parts of the empire. The mina, equal to one-sixtieth of a talent, and the shekel, equal to one-sixtieth of a mina, were the smaller units of weight. The Achaemenid, Parthian, and Sasanian states all used variants of this system, and the Sasanian weight standard was adopted, in turn, by the Islamic caliphate in its dirham and dinar.
The principal units of length were the parasang, equal to about 5.5 kilometres, and the cubit, equal to about 0.5 metres. The parasang was a major unit of road distance, and the cubit was the principal unit of architectural measurement. The principal unit of area was the gava, a measure of land equal to about 1,000 square cubits, or about 250 square metres. The gava was used for the assessment of land tax, and the cadastral surveys of the Persian state were organised around the gava.
The principal unit of volume was the artaba, a measure of dry goods equal to about 30–70 litres depending on the period and the region. The artaba was used for the measurement of grain, dates, and other dry goods, and the artaba of the Sasanian period was the principal unit of grain taxation.
Contracts and partnerships
The Persian merchants used a wide range of contracts and partnerships to organise their trade. The most important of these was the partnership contract, in which two or more merchants pooled their capital for a particular venture and divided the profits in proportion to their investment. The partnership contract was well developed in the Achaemenid, Parthian, and Sasanian periods, and it was the ancestor of the Islamic qirad and mudaraba contracts.
The forward sale, the manufacturing contract, and the loan contract were also used by the Persian merchants. The forward sale, in which a merchant agreed to deliver a particular quantity of goods at a future date for a particular price, was a major instrument of the long-distance trade, since it allowed the merchant to finance the production of goods in advance of the sale. The manufacturing contract, in which a merchant commissioned a particular quantity of goods from a craftsman, was a major instrument of the textile and metalwork trade. The loan contract, often in the form of a bill of exchange, was a major instrument of the long-distance credit.
The Achaemenid, Parthian, and Sasanian states all maintained courts of law for the adjudication of commercial disputes. The court was typically presided over by a dastur, or judge, and the cases were decided according to a combination of customary law, royal decree, and religious principle. The decisions of the dastur were recorded in writing, and the records of the court were a major source of legal precedent.
The merchants
The merchants of the Persian world were a major element of the social and economic life of the empire. The great merchant families of the Achaemenid, Parthian, and Sasanian periods were based in the cities of the empire, and they maintained a network of agents, brokers, and partners across the wider world. The Sogdian merchants of the Sasanian and early Islamic periods, in particular, were the principal commercial agents of the Silk Road, and the Sogdian language and script became the lingua franca of the trade. Frantz Grenet’s work on the Sogdian merchants and Étienne de la Vaissière’s Sogdian Traders for the Iranian side, the working references.
The merchants of the Persian world were organised into guilds, the asnaf, which were responsible for the regulation of the trade, the training of apprentices, and the welfare of the members. The guild was typically based in a particular section of the bazaar, and it maintained a suffa, or lodge, where the members met to transact business and to discuss the affairs of the trade. The guilds were also a major element of the political life of the city, and they often played a major role in the appointment of the muhtasib and the regulation of the bazaar.
Credit and banking
The Persian merchants used a wide range of credit instruments. The bill of exchange, the sakk, the suftaja, and the istisna were all used in the Achaemenid, Parthian, and Sasanian periods, and the system was further developed in the Islamic caliphate. The sakk (cheque) is widely credited to the Persian merchants of the ninth and tenth centuries, and the medieval Islamic banking system, with its money-changers, deposit banks, and letter-of-credit networks, was in significant part a product of Persian commercial practice. The hawala, the informal value-transfer system that is still in use in the modern Middle East, has its roots in the Sasanian period.
The principal banking families of the medieval Islamic world, including the banu families of Baghdad, Basra, and Isfahan, were often of Persian origin or had close connections with the Persian commercial world. The banking families maintained networks of agents and correspondents across the Islamic world, and they were the principal channel for the transfer of funds from one city to another. The banking system of the medieval Islamic world developed, in significant part, from the Persian system of the Sasanian period.
The role of the state
The Persian state played a major role in the regulation of the trade. The state levied customs duties, controlled the mints, maintained the roads, and protected the merchants from bandits and foreign enemies. The state also maintained a system of royal warehouses, the ganj, for the storage of goods in transit, and a system of royal inspectors, the mustaufi, for the supervision of the trade.
The Persian state also intervened directly in the economy, in particular in the regulation of strategic commodities. The Sasanian silk monopoly of the sixth century, the Achaemenid monopoly of certain metals, and the Sasanian regulation of the pearl fishery are all examples of state intervention in the economy. The state also used its control of the economy as an instrument of foreign policy, as in the Sasanian control of the Silk Road and the Persian Gulf trade.