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Lecture by:
Leonidas C. Polopolus
Professor Emeritus
Food and Resource Economics
University of Florida


Athens has been a perennial urban center from its birth in
antiquity until the present dawn of the 21 st century. As the
premiere city-state, Athens, Greece provides an excellent example of
the societal benefits that arise from progressive urban leadership
exhibited by its citizens of the ancient period, as well as what can
go wrong with excessive population and environmental degradation
in a modern era of the late 1 990s.

The City-State

A city-state is a geographic area that has one major central city
containing a concentration urban residents. Each city-state does
have a suburban and/or rural fringe, whose population are tied to
the central city.

The concentration of urban citizens in a central city are made
possible from a commercial agricultural sector that creates
sufficient storable food that can be consumed by the urban non-
food producing residents. Thus, a city emerges, not simply in
conjunction with, but as a direct result of advances in agriculture.
Where there is no agriculture, we find only a very thin
concentration of population (Bairoch, 1991, p. 1). Urbanization
cannot take place without a concentration of population.

Athens, Greece provides one of the first examples of a city-state in
the ancient world. Ancient Rome also influenced the urban
architecture and urban planning for Europe over the centuries.
There is no doubt that the Graeco-Roman world exhibited an
extremely urbanized way of life.
In addition to technological advances in ancient Greek agriculture,
there were several other factors that contributed to the success of
urbanization of the Athens city-state:

Greece had a written alphabet by 700 B.C.
The ancient Greeks invented coined money.
Central banks were invented by the ancient Greeks.
The city conducted a variety of cultural functions for its
The Agora, as a place for public functions, became the focus of
urban life.

Communications are obviously enhanced with the ability of citizens
to read and write a common language.

Money is of utmost significance for economic activities in general
and for urban life in particular. Coined money is certainly an
advantage over the barter system which prevailed in the rest of the
ancient world.

The use of coins made exchange easier and thus favored the growth
of cities by giving them the additional function of issuing currency.

Classical Greece had a type of city-state in which the cultural
functions of the city became important to its citizens.

At its inception, the agora was a place where public assemblies
gathered. The agora became the focus of urban life because of such
cultural functions as the theater, religion, and city administration.

One can argue that the achievements of the ancient Greek
civilization are, in effect, the positive results of Greek city-states,
particularly Athens.

Optimum Size of a City-State

Greece appears to have been the first civilization to raise the

of urban planning from the point of view of size. Both Plato and
Aristotle addressed this problem in somewhat different ways.

Aristotle insisted on the existence of a minimum population (from
Politics, VII), as well as a maximum size, in both cases without
specific numbers. In treating size, Aristotle gives emphasis on the
public function of cities: "It is vital that the citizens know one
another". He was also worried about the problems of security when
cities become too large. "Foreigners and half-breeds usurp without
difficulty the rights of citizens because it is easy for them to escape
notice owing to the size of the population".

In Laws, V. 74, Plato states that the ideal republic would have
5,040 citizens, i.e., heads of households. This figure implies an
optimum size population of about 20,000 people. He linked his
optimum size of city to the need for communications among
citizens. "The city must remain sufficiently small to permit the
holding of public meetings with all of the citizens present."

Greek city-states of the ancient world did in fact remain limited in
size. Athens (Attiki) was the largest Greek city-state, approaching a
population of approximately 100,000 by 500-450 B.C.

The other Greek city-states rarely had populations as many as
40,000 people. As a general rule, as soon as a city approached a
population of 20,000 to 30,000, it decided to found a new city
ratherthan to continue the original city's development.

The ancient Greeks understood the constraints to excessive urban
development. These constraints involved the limited productivity of
the soils to produce food and the increasingly high cost of
transportation to the central part of the city from the hinterland
(and vice versa).

Thus, the ancient Greeks knew that the cost of urban growth
became prohibitably high at certain levels of population.

Transportation and the Location of a City

According to Aristotle, transportation was an important
consideration for urban planning. First, a city should be so
configured so as to permit military aid to all parts of the city-state's
territory. Second, the city should be able to provide transport of
foodstuffs and wood for buildings, as well as materials for

Also, it was important for Athens to have the ability to export items
to other city-states and foreign nations, as well as import necessary
grain from distant lands. Thus, ports of entry and exit were needed
for goods. This gave rise to naval transportation, in addition to the
ground transportation methods employed at that time.

Importance of International Trade

The sale of exported goods from a city-state created wealth for the
city-state. Even in ancient times, exports provided capital that
multiplied in importance within the exporting city-state. For
Athens, it was the export of its manufactured goods, as well as olive
oil, that generated the drachmae to import needed grain. The overall
effect was an increase in wealth for Athens and a better standard of
living for its citizens.

The urbanization of Athens of ancient times created highly
specialized laborers and craftsmen. This division and specialization
of labor contributed to the economic success of the city-state.

(Scholars have largely ignored the function and economic role of
cities of ancient Greece. This is reflected in the scant amount of
literature on this subject.)

We do know from the literature, however, that grain imports into
Athens were crucial for the economic performance of the ancient
city. The municipal assembly of Athens, for example, was required
to regularly inscribe on the order of the day the assurance of
provisions of wheat. Wheat supplies were as important to Athens as
matters dealing with national defense. Athenian law regulated
wheat trade so as to protect the interests of its consumers

Domestic Trade in Athens

The city of Athens provided the marketplace for the surrounding
district of Attiki. Peasants from the outlying areas came into town to
sell their products in exchange for money to pay their taxes, rents
and manufactured goods.

Retailers also existed in ancient Athens. Artisans and other
craftsmen sold their items from their workshops. Some of these
items, particularly pottery, became so wel1 known that they were
exported to foreign markets.

Overall, the economy of ancient Athens became the forerunner of
the medieval economies of Europe several centuries later.

Banking in Ancient Greece

It is estimated that there were banks in 53 Greek city-states (
Bairoch, 1991, 78). The functions of these banks went beyond mere
money changes. Greek banks engaged in payment operations for
trade and manufacturing. They also were involved with consumer
credit and public sector financing.

Public Sector Employment in Ancient Greece

The role of government in public services also required specialized
personnel. Thus, jobs became available in ancient Athens for work
in such areas as urban administration, public transportation,
police, street cleaning, garbage disposal and the maintenance of
public gardens.

Nations versus City-States as Economic Generators

The contemporary thinking of most economists, as well as the
general populace, is that a nation is the operative economic unit for
analyzing economic performance, not city-states.

This primacy of nations as the basic economic unit for analysis is
rooted in our belief that Keynesian economics can be used
effectively to control business cycles. Using such macroeconomic
variables as interest rates, levels of unemployment, government
spending and wage rates, a nation could stabilize price levels,
employment, and interest rates through government actions.

The ineffectiveness of Keynesian economics to control business
cycles has led some economists to question the validity of this
approach. One such economist is Jane Jacobs who places her
reliance on city-states as the engines of economic growth for

A review of early world history tells us that city-states ruled world
trade for centuries, beginning with ancient Greece. Eventually, city-
states lost out to nation-states for a variety of reasons. One such
reason was that city-states had few resources to dominate
neighboring economies and world markets. Another reason was that
politics dominated economics. City-states are primarily economic
units, while nation-states are mainly political units. Since nations
are defined by political boundaries, city-states became subjects of
the larger nation-states over time (Barnes and Ledebur, 1998, p.

When looking at the performance of individual nations, Jacobs
argues that the cities, not nations, provide the economic engines for
growth and development. According to Jacobs, "nations are political
and military entities, and so are blocs of nations. But it doesn't
necessarily follow that they are also the basic, salient entities of
economic life".

Basic Conclusions Regarding Ancient Athens From the Point of
View Of Economics and Economic Development

The city-state of Athens is well known for its contributions to
Western civilization in terms of philosophy, science, architecture,
medicine, and mathematics. Hardly anyone pays any attention to
the contribution of the city-state of Athens for its contributions to
Western civilization in terms of urban planning, public
administration, food policies, money and banking, and overall
economic policies. In reality, the contributions of the citizens of
ancient Greece were highly significant and innovative, making
lasting contributions to economics, money and banking, public
administration, and public policy.

Historical Transition from the Classical Period to the Modern

Although Athens virtually lost its independence to Macedonia in
338 B.C., the city continued to be an important cultural center. It
fell to Rome in 146 B.C., but maintained good relations with the
Romans until they sacked it in 86 B.C., destroying many of Athens'

Nonetheless, Athens remained a center of learning for prominent
Greeks and Romans from the lst century B.C. until late antiquity.
In the 3rd century A.D., it was damaged by invading Goths, who
were repelled with some difficulty. In 529 A.D. the Christian
Emperor Justinian closed the pagan philosophical schools, virtually
ending the city's classical tradition.

In effect, the citizens of Athens entered a long period of bondage
(that lasted almost 2,000 years) three centuries after the death of
Pericles in 429 B.C.

During the Byzantine period from roughly 400 A.D. to 1450 A.D.,
Athens became a cultural backwater. Many of the city's artworks
were moved to Constantinople. The temples became Christian
churches. Byzantine emperors occasionally visited Athens, but the
city was largely ignored and impoverished.

The Ottoman Turks gained complete control of Athens in 1458 A.D.
The Parthenon, built as the major temple of the goddess Athena,
was ~then made into a Muslim mosque. Under Turkish rule, the
city was still run by Greeks, even though the population of the city
had a mix of Greeks, Turks and Slavs. The Parthenon was badly
damaged in 1687 A.D. when a Venetian bombardment ignited
gunpowder that had been stored inside the building.

The Modern Period

The Greek War of Independence (1821-1829) liberated Athens from
the Turks. Athens was subsequently made the capitol of the entire
nation of Greece. Thus, Athens now shifts from merely a city-state
to the central location for the nation-state of Greece.

For the remainder of the 19~ century, Athens remained a relatively
small city, serving mainly as a tourist center for its ancient
monuments. The population Athens by 1900 is estimated to have
been about 100,000 (Table 1). In the 20th century, the population
of Athens increased dramatically from 100,000 in 1900 to over 3
million by 1996 (Table 1).
Some Demographic Characteristics of the Current Athens
The Athens city-state (Attika) represents the largest concentration
of population in Greece today. The Attika region (of which Athens is
the largest component) had 3.5 million people in 1991/92 or more
than one-third of Greece's total population of 10.3 million (Table 2).

The urbanity of modern Athens is also seen in data reflecting
population density or the average number of people living in a
kilometer. For Greece as a whole, there are 78 people living in a
kilometer, while for Attika, population density per square kilometer
is an
astonishing 923 (Table 2).

Productivity per individual, measured by Gross Domestic Product
(GDP), is only slightly higher for the Athens regions compared with
Greece as a whole (Table 2). The productivity per individual for
Athens is
hampered by the higher unemployment rate for Athens (9.9%) when
compared with Greece as a whole (7.7%) (Table 2).

A cross section of the economy can be gleaned from a look at how
total employment is distributed among the three basic sectors of
agriculture, industry and services. From Table 2, the Athens region
has ceased to be a major agricultural production region, with only
1.2% of the total workforce in the Athens region gainfully employed
in production agriculture. For Greece as a whole, 22.2% of the total
workforce is employed in production agriculture.

The comparisons for employment in "industry" for Attika and
as a whole are quite similar. There is, however, a wide difference in
percentage of workers employed in "services". For the Athens region
1991/92, over two-thirds of the workforce were employed in the
sector, while that number for Greece as a whole was slightly over
one-half of the total (Table 2).

The Industrialization of the Athens Region

With the growth of population of the Athens region in the 20t
Century came industrialization. Much of the "industry", however,
was initially controlled and operated by the central government,
headquartered in Athens. Thus, the banks, the railroads, the
airlines, the buses, the telephones, and the electricity were run by
government agencies.

Since Greece's entry into the European Union in 1982, Greece has
been attempting to privatize many of the services controlled by the
government. This effort continues with limited successes. Part of
the difficulty with Greece's competitiveness in world markets is due
to the inefficiencies of some of Greece's services run by Government
entities, i.e., the Olympic Airways.

With the government involved with so much economic activity for
Athens as well as the entire country, the government, however, is a
major source of employment for the people of Greece. This
sometimes has a tendency to lead to politics in getting a job with
government agencies.

Shipping and tourism are both headquartered in Athens and
provide for a significant economic stimulus. Greece has the largest
fleet of commercial vessels in Europe and highly ranked in terms of
tonnage in the world. The cruise ship industry is also highly
developed in Greece, with Athens (Piraeus) serving as headquarters.

In terms of manufacturing, Athens is also the headquarters for the
following important industries (among others):

Cement Textiles
Alcoholic beverages
food and soft drinks
Paper products
Leather goods
Chemicals and petrochemical products
Printing & publishing
Machinery and transport equipment

While the Athens city-state of Attika accounts for slightly more than
one-third of Greece's total population, it leads the nation in a
number of economic categories. For example, Attika accounts for
the following percentages of Greece's:

37.4% of national Gross Domestic Product
39% of total manufacturing employment
40% of employment in the energy sector
77% of Greece's international organizations
60% of employment in financial services
54% of employment in mortgage services
48.5% of employment in transportation services
48% of employment in health services
45% of government employees

The Athens city-state also has the highest percentage of Greece's
educational institutions, research centers and technological
centers. Moreover, this region of Greece has the nation's largest
airport. The port of Piraeus has the largest capacity of any port in
the Balkans.

And unfortunately for the air quality in the summer season, the
Attika region has 43.6% of Greece's automobiles.

Thus, the Athens city-state has been transformed from a somewhat
agrarian region in ancient times into a modern industrial society by
the beginning of the 21 st century, owing to the diversity of
manufacturing and service activities in the region.

Athens and its port city of Piraeus is a major hub for the export of
Greek goods, as well as the import of foreign items.

Neighboring European Union countries account for 60% of Greece's
exports. The major trading partners are from Italy, Germany,
France, the Netherlands, the United Kingdom and the United
States. Some of the major products exported from Greece include
wine, fresh and processed fruits and vegetables, olive oil, clothing
and textiles, minerals, fuels and lubricants, iron, steel, aluminum
and associated alloys. The principal market for Greek exports is

As a member of the European Union(EU), as well as the Euro
zone ';

euro currency, almost two-thirds of Greece's imports are from EU

Some of the major items imported into Greece include petroleum
associated products, motor vehicles, machinery and transport
equipment, food and live animals, chemicals and associated
products. Italy is a major source for imported items.

Environmental Issues

The growth of Athens, particularly since World War II, has led to a
myriad of environmental problems. The high population density,
coupled with a large number of automobiles, has led to problems of
air quality. Traffic remains congested, as the city was not designed
in antiquity to handle millions of autos and taxi cabs.

Garbage disposal is also a problem area, along with potential
pollution of the nearby Aegean sea. Almost annual forest fires in the
Athens region also affect air quality.

The Greek government is keenly aware of its environmental
problems and other problems caused from urban sprawl. A new
subway system was opened in 2002, as well as the opening of a
large new international airport in nearby Spata. Various schemes
have been imposed on restricting personal automobiles from
entering the central core of the city of Athens. The government is
also attempting to relieve automobile congestion in downtown
Athens by constructing peripheral ("ring") avenues which allow
avoidance of the central areas of Athens.

Development of new transportation systems in the Athens area is
uniquely slow because any type of digging below the current earth's
surface uncovers previously unknown treasures from antiquity.

The government program to make the Attika regions a sustainable
city rests on a comprehensive plan to go forward with intervention
programs dealing with the following problem areas: Air pollution
Waste disposal Traffic congestion Noise pollution Land use planning
Urban development Environmental awareness Appropriate

Dealing with the above problem areas, simultaneously with
developing the infrastructure and venues for the 2004 Olympic
Games, will challenge any city-state and nation-state.

Concluding Remarks

Over the span of almost 3,000 years and despite many years of
subjugation by various rulers, Athens remains a city on the hill.
The remarkable contributions of the Athens city-state of the golden
ancient period have remained on a worldwide basis: coined money,
banks, public services, and land use planning.

Athens in the 20th and 21St centuries, despite its high population
density, makes important contributions to its nation-state (Greece)
and to the world at large. Despite its small size relative to other
major city-states like London, New York and Tokyo, Athens has
produced two Nobel laureates in literature in recent decades and an
Oscar for the best music in a movie (Never on Sunday).

According to the Encyclopedia Britannica, the Athenian is witty,
warm and generous. They have maintained their long oral tradition,
which has led them to seek discourse that tends to exaggerate
reality. Athenians have a sharp-edged sense of personal and family
honor and the spoiling of children.

The ancient heroes, too, were vain about both themselves and
honor, boasting as much about outwitting the enemy as about
outfighting them (Britannica, 2001).

Selected References
Bairoch, Paul, Cities and Economic Development: From the Dawn of
Hist~ry to the Present, Chicago: University of Chicago Press,
paperback 1991.

Barnes, William R., and Larry C. Ledebur, The New Regional
Economics: The U.S. Common Market and the Global Economy,
Thousand Oaks, California: Sage Publications, 1998.

Camp, John M., The Athenian Agora: Excavations in the Heart of
Classical Athens, London: Thames and Hudson, 1986.

Encyclopedia Britannica

Various internet sites on Athens, Greece