Brexit has happened once before in our history – look what happened

What lessons for Brexit can be drawn from Britain in AD410? Nigel Culkin (University of Hertfordshire) and Richard Simmons write about the broken supply chains and money troubles of the fifth century in an article for the London School of Economics entitled -“Failed state” Britannia: 5th-century experiences highlight some of the risks of Brexit.”

 

Imagine you are living in the prosperous Roman town of Durnovaria (or Dorchester, as it’s known today) around the middle of the 4^th century. Life is probably quite good. We know this because, archaeological evidence suggests the town had a healthy level of activity in the 4^th century, with a fair degree of new building. In contrast to Gaul, following the crisis of the late 3^rd century (when Gaul’s Roman supply chains were disrupted by Barbarian invaders) along with much of Britannia, Durnovaria represented a growing economy until perhaps the final 25 years of the 4^th century.

How then within 50 years could both the supply chains and the monetary economy have collapsed and AD410 Brexit Britain have perhaps become “failed state Britain”?

In Britannia, Roman rule had been if anything strengthened by the crisis of the 3^rd century, as supply chains reordered themselves to becoming more local. For example, the pottery trade changes from elite “purple coated ware” that used to be exported across the whole Empire to more local items manufactured in the area around the New Forest. As these supply chains changed so did the roles of the towns servicing them.

From the end of the 3^rd century there is evidence of gentle decline in Londinium as trade on the historic supply routes across Gaul retrenched; whilst other towns evolved to the new situation. Archaeologist Simon West describes how Verulamium (St Albans) changed with the historic forum showing signs of 4^th century artisanal use with less robust and imposing structures than in previous centuries. This echoes work by Adam Rogers that suggests the public areas (e.g. the forum) in late Roman Britain had started to host ramshackle buildings in tandem with a decline in the previous grand public edifices. Such changes coincided with the development of sumptuous villas in the rural hinterlands of the towns as the aristocracy retreated to their rural estates. Britannia, in stark contrast to Gaul, had adapted to the reordered supply chains of the 4^th century.

The bedrock of this stability was the role of the Roman army, as both a military protector and, as an engine of economic development. The army’s economic role came through its procurement needs which acted as the anchor for local supply points (such as the settlements around forts on Hadrian’s Wall), the protection of supply routes to local towns and food purchases sent to Rome. This generates a need for money to fund the military’s presence. Coin flowed from the colonies to Rome in taxation, and then back from Rome as it paid for both army and needed provisions. This circular flow became the anchor for a monetary economy that stretched across the entire Roman Empire. Remarkably, according to Esmode Cleary, the Roman tax rate seems to have been broadly similar to today, at maybe 25% to 33% of gross yields.

Common coinage facilitated a market economy with supply chains that traversed the Empire. According to contemporary writers, Britannia’s export economy seems to have been dominated by basic items such as grain, hunting dogs, slaves and minerals although there are some examples of fine pottery exports. In this goldfish bowl of an integrated empire, we can see the strong and stable links between the state as “protector”, “anchor economic actor”, money (enabling commerce) and far-flung supply chains.

Some popular myths see the collapse of Roman Britain as the consequence of invasion from marauding invaders. This view is most likely derived from the pages of the Gallic Chronicle of AD452; however, archaeological evidence paints a different picture.

In AD408 it became clear that the Roman army had left for good. Britannia stopped paying taxes to the Emperor and there was an almost complete cessation of coin shipment to Britannia. Coin hoards with coin dating after AD408 are exceptions, and local, rather than general. For example, coinage dated to AD421 found at Richborough seems to have represented an isolated attempt to reinstate a monetary economy.

As new coinage stops, the monetary economy starts to change. Once long supply chains become shorter, activity moves to the better-protected rural villas, leaving the towns to decline. The pattern is not uniform; some areas, especially in the West and around the Thames Valley, took much longer to decline; but over a period of say 50 to 100 years marked changes have occurred. We see a less urbanised landscape, with more of the activity based very locally around the larger estates. The old industries and trading activities have gone. We are in a new more localised economy, centred on specific areas and not unified. Arguably the unified English “Single Market” does not fully re-establish itself until over 1,000 years later – during the age of Elizabeth I, to be precise.

 

Brexit AD410 had happened: politically the Roman civic state had been shattered, and economically the supply chains and monetary economy it depended on had disappeared. There were later European supply chains, such as the 6^th and 7th-century link that brought luxuries to the West Country; however, these were far more limited than those of the Roman Empire in its prime. Money was still used, but without the ubiquity of the Roman era, coinage and general trade was a shadow of its former self.

 

Which brings us to today’s Brexit landscape. Twenty-first century supply chains are far more complex than those of the 3^rd and 4^th centuries. For example, component items in the automotive industry can cross borders several times before they end up as a finished product. Monetary mechanisms also sophisticated allowing seamless convertibility between multiple currencies. The financial and monetary mechanism of today suggest that a Brexit shock today will be less severe than in AD410. But all change to supply chains risks disruption. The post-1989 experiences of the former Comecon countries, and especially Russia, demonstrate how shattering an existing trading system can cause major dislocations, that can as in post-cold war Eastern Europe, require outside help and support to effect the transition.

Do the experiences of the 5th-century highlight some of the risks an unplanned “hard Brexit” transition could involve?

 

This article first appeared at the London School of Economics

Nigel Culkin is Professor of Enterprise and Entrepreneurial Development at the University of Hertfordshire. In 2014, he was elected to the post of President at the Institute for Small Business and Entrepreneurship (ISBE); and, in 2015, was invited to join the prestigious Peer Review College at the Economic and Social Research Council (ESRC). Nigel is a regular attendee at the UNCTAD Expert Meeting on entrepreneurship and building productive capacities, held in Geneva. 

Richard Simmons is an economist with expertise in SMEs as innovation engines. Richard has a strong belief in market solutions, with interests in growth processes, ethical financing and dynamic (including monetary) equilibrium in an entrepreneurially driven and financially sophisticated world.

 

 

 

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