and loan. Naturally, these ideas spread to the private sector (Steinkeller 2002 ) – some
scholars assume that it even originated in this sphere – and the interest-bearing debt
became, more than other forms of lending, an important economic issue (Postgate
1992 : 168 f.). Interest rates were high but varied greatly; the figures usually given in
our history books are 331 ⁄ 3 per cent on barley and 20 per cent on silver loans, but for
all such estimations the running time of the loan needs to be taken into account (Stol
2004 : 863 ). Van De Mieroop’s observation demonstrates how profitable the loan busi-
ness had become: ‘the overseers of the merchants sometimes preferred to invest their
capital in loans rather than in new trade expeditions’ (Van De Mieroop 1992 : 206 ).
Consequently, some people were able to amass great wealth, and they began to make
use of their new economic power. The resulting problems that the central power had
to deal with were twofold: on the one hand, the nouveaux richeswere contesting the
existing social order and could eventually even threaten the position of the king and
the ruling elite, although this could be lessened by involving such groups in public
affairs and by entrusting them with higher positions in the state. On the other hand,
the impoverishment of a larger part of populations endangered the political stability
at the lower end of the social hierarchy.
While some interest-bearing loans may have had purely speculative character, the
mass of debtors were people in dire need. If a citizen was repeatedly unable to meet
his debts, he could be forced to hand members of his family over to the creditor to
work on the creditor’s behalf in order to make up for outstanding payments. This
kind of debt slavery was not uncommon, and a considerable number of the population
lost any chance to improve their economic situation. To counter the possible permanent
enslavement of large parts of the population, Hammurabi restricted in his laws the
period of debt service to a maximum of three years, ‘their release shall be secured in
the fourth year’ (§ 117 ). Nevertheless, debt obligations and the resulting impoverish-
ment seriously tilted the balance of the social order. In fact often a kind of vicious
circle was started, which Van De Mieroop describes as follows:
The borrowers were placed in a very bad economic situation by loans whose
interest rates seem to have been exorbitant. When a loan defaulted and a field
was mortgaged the creditor obtained the usufruct of the property, and usually
rented the field out again to the debtor for a rental fee. When the debtor was
unable to pay the rental fee with the products he grew, he had to borrow more
silver and so became more indebted to the creditor.
(Van De Mieroop 1992 : 208 )In order to avoid the imminent collapse of the entire Old Babylonian economy,
the rulers promulgated ‘edicts of justice’, edited and studied by F.R. Kraus in his
groundbreaking work of 1984 (cp. Charpin 2004 : 307 – 310 , 370 – 371 ).
THE OLD BABYLONIAN ROYAL EDICTS
AND THE CRISIS MANAGEMENTAlready the cancellation of service obligations by the Early Dynastic ruler Enmetena,
the remission of debts, and protection of the poor proclaimed by Uru-inim-gina, were
— Gebhard J. Selz —