Multinational Enterprise in AncientPhoenicia'

KARL JAMES MOORE andDAVID CHARLES LEWIS

Templeton College, University of Oxford

In his recent massive work on Mullinational Enterprises (MNEs)., Dunningstates that 'eitriier examples ol' embryonic MNEs can, most surely, be found inthe colonizing activities of the Phoenicians and the Romans, and before that,in the more ancient civilisations ... However, this sort of history ... remains tobe written".' Considerable literature has recorded the evolution of MNEs inEurope since the early Middle Ages.' There have also heen a number of booksand articles written on the economic history of this part of the ancient world.However, little has been written concerning the earliest recorded MNEs.

In an effort to shed light on embryonic MNEs in ancient civilisations, thisarticle brings together a modern theory of the MNE and literature on ancientPhoenicia. Led by Tyre, the city-states of ancient Phoenicia became thegreatest seafaring traders of ancient times. Using Dunning's eclecticparadigm as a lens, this paper suggests these early Canaanite traders werearchitects of the first truly intercontinental multinational enterprise, spanningparts of Asia, Africa and Europe. The managed business hierarchy created bythe merchants of Ugarit and Tyre, moreover, foreshadowed, in some of itsfeatures, the international keiretsu networks of contemporary Japan.

nAs a starting point we shall define some key terms which are fundamentalto our argument, namely, multinational enterprise and the eclectic paradigm.The definition of MNE used in this article is that accepted by theOrganisation for Economic Co-operation and Development (OECD) andthe United Nations Center for Transnational Corporations (UNCTC), "anenterprise that engages in foreign direct investment (FDD and owns orcontrols value-adding activities in more than one country".^ Importantelements of this definition are value-adding activities and owns or controls,which will come up later in this article.

Business History. Vol.42. No.2 (April 2tKK)). pPUBLISHED BY HKANK CASS. LONDON

18 BUSINESS HISTORY

Though there exist competing theories with different perspectives"seeking to explain international production, this article adopts the eclecticparadigm in examining potential MNE behaviour in ancient Phoenicia. Theeclectic theory or paradigm offers a framework for determining the extentand pattern of foreign-owned activities: it may be handily summarised bythe acronym OLI, or ownership, location and internalisation advantages. Itis the configuration of these advantages, ownership, location andinternalisation, which either encourage or discourage a firm to undertakeforeign activities and become an MNE.

Ownership advantages are firm-specific advantages (FSAs) which areowned or controlled by a firm. Country-specific advantages are ones whichare based on the location of the enterprise. Finally, internalisationadvantages iue those which accrue to a firm when it internalises or bringsinside the hierarchy of the firm activities which could be performed by themarket.' The following paragraphs provide greater detail on the eclecticparadigm. Readers familiar with the paradigm may wish to skip this section.It is provided since this article may be of interest to at least two groups:business historians and international business researchers, the former groupnot generally being as familiar with the eclectic paradigm.

Internalisation advantages are based on the hypothesis that MNEs grow'by replacing imperfect (or non-existent) external markets by internalones'." Several important ideas are contained in this definition. The first isthat MNEs can be the most efficient means of international production whenimperfect markets exist. The most important imperfect market for MNEs isthe pricing of proprietary information which is generated by a firm but hasmany of the attributes of a public good.

Proprietary information can include knowledge developed by the firmby R&D (both technical and marketing), managerial experience, newproduction techniques, production differentiation and market knowledge." Apublic good is 'a good for which consumption by one party does not reducethe consumption of others. Knowledge is a public good in this theoreticalsense because it can be applied by any person or organization to a specificproblem without destroying the ability to apply the knowledge to anotheruse'.'" The price of a public good is zero: the market cannot price a publicgood. Thus, in order to profit from investment in knowledge development,the firm 'internalises, using its internal market to monitor and control theuse of the knowledge in a way the market is unable. Knowledge is aintermediate product, and the profit to the firm accrues from the sale to acustomer of the final product or service. This use of "intermediate product'expands the traditional definition of intermediate products as ordinary semi-processed materials to include knowledge inputs.

ANCIENT PHOENICIA 19

Other market impertections include government regulations, taxes,controls, tariffs, non-existent futures markets, and inequality betweenbuyers' and sellers' knowledge of the value and quality of the product. Allof these distort market prices and act as additional incentives to utiliseinternal markets."

Rugman and Gestrin define FSAs as 'the competitive strengths of thecompany; they can be cither production-based (cost or innovationadvantages) or marketing-based (customization advantages)'.'' Dunning"suggests a number of potential FSAs: those associated with the size of firm(such as economies of scale, product diversification); management oforganisational expertise; the ability to acquire and upgrade resources; labouror mature small-scale intensive technologies; product differentiation;marketing economies; and access to domestic markets. He also lists theability to foresee and take advantage of global production and marketingopportunities: capital availability and financial expertise; access to naturalresources; and the ability to adjust to structural changes.

CSAs arc defined as 'the national factor endowments of a nation -basically the variables in its aggregate production function'." Dunning'"*suggests a number of potential CSAs: input costs (such as labour wages andnational resources); labour productivity; the size and character of markets;transport costs: and the psychic distance from key markets and the homecountry of the MNE. There are also tariff barriers; the taxation structure;risk factors; attitudes toward FDl; and the structure of competition. Havingfinished this brief introduction of the central ideas of the eclectic paradigm,this article now considers events from the Phoenician empire.

mInternational trade began to develop in the Near East around 3500 BC. Bythe second millennium BC the city-states of Sumer, Assyria and Babylonlay at the centre of a network of trade in copper, tin, silver, foodstuffs andtextiles thai stretched from Egypt and Crete to the Indus River Valley andAfghanistan. To help readers who may not be familiar with the geographyor chronology of the time and area we have provided a historical map inFigure 1 and a chronology of Phoenicia in Figure 2.

The first known multinational enterprises arose in the city of Ashurbetween 2(X)0 and 1700 BC. Their story, more fully documented in aprevious article,"' may briefly be summarised. State-supported but family-owned and managed firms headquartered in the Old Assyrian capital ofAshur opened subsidiary trading and manufacturing offices in Babylon,Syria, other parts of northern Iraq, and, most importantly, the city of Kaneshin Cappadocia, from which a number of smaller offices in Anatolia (modem

ANCIENT PHOENICIA 21

FIGURE 2l'll.'\.SiiS OF PHOENICIAN COMMKRCIAL EXPANSION

Phase Time Period Driving Force Areas where activityoccurred

Pretiminary Phase 1000-890 BC

Continental Phase

Intcrconiinenlal-Mullinalional Phase

890-840 BC

839-538 BC

Business partnership witha uniicd Israel

Tyre allenipi.s to become anAsian land power

Redirection of Tyrian tradetowards Assyria and waveof colonisation acrossMediterranean

Red Sea, A rah i a.East Africa and India

Israel. Cyprus.AnalolJa. Syria andAssyria

Assyria. Spain. WestAfrica to Babylon

Turkey) were tnanaged. Similar multinational firms, on a smaller scale,were found in Babylonia under Hammurabi and. later, the Kassite kingswho set up subsidiary trading offices on Bahrain in the Arabian Gulf."

Virtually al! of the second-millennium and even early first-millenniumBC business cultures of the ancient Near East were mixed economies.Private landholdings. markets and private, usually family-owned, firmsoperated in close harmony with royal and lemple enterprises."* Phoeniciawas no exception. The commercial records from Ras Shamra and Ugarii,augmented by a few later sources, depict a system of managed trade andenterprise founded on strong religious and feudal connections. Like Sumer.Assyria and Babylon. Phoenicia was a supernalural-oHented societyworshipping a hierarchy of gods, goddesses and spirits who organised anddirected not only the affairs of nature but the affairs of humankind. Creationwas organised on a feudal pyramid: Baal-Melkart and Astarte weresupreme: an assembly of lesser gods and goddesses paid them homage.Subject to these spirits were princes, priests, nobles, businessmen, peasantsand slaves.''' Everyone was expected to play his or her role in a divine orderof creation and nature, and this had considerable implications for busitiessenterprise. Independent merchants and more free-markel models ilourish incultures, such as Classical Athens, whieh encouraged rationalism, and theProtestanl but quite secular United States, where the traditional belief in aGod who was above, noi part of. his creation ultimately encouraged, as didrationalism, individualistic thinking. Oriental societies, such as ancientPhoenicia and modern East Asia, were, in contrast, rooted in a pantheisticoutlook that decreed that the search for profits had to be in harmony withthe natural order rather than being motivated by self-interest alone.^"

22 BUSINESS HISTORY

IV

In ancient Phoenicia private commerce and the temple-state were partnerswhose functions and roles overlapped and interlocked. A pyramid structurewith the Prince of Ugarit, Byblos, or Tyre and the high priest of the city'spatron deity at the top. followed by the bureaucracy led by the vizier andhis harbourmaster, then the landed nobles and the major merchant-princes,known as mkrm, and their firms, followed by the lesser firms or hidaluma,craft guilds, peasants, serfs and slaves. Private and public executive roleswere never sharply defined. Commerce in the city-states was dominated byan assembly of private and royal merchant princes. In Phoenicia, as inBabylonia, and even modern Britain, merchants could enter the aristocracyand aristocrats could take up commerce. The mknn Ahdihaqab of Ugarittraded overseas for his own profit, but also for that of his prince, beingrewarded with a hereditary landed estate.-' The mknn Sinaranu fared evenbetter as Prince Niqmepa's real estate agent, probably becoming the richestman in Ugarit. Sinaranu owned his own shipping company, whichNiqmepa granted a royal monopoly in trading with the Aegean, especiallyKaphtor (Crete). Sinaranu and his firm also served as tax collectors for thewhole Ugaritic realm, subcontracting many of their duties to lessermerchants, or bidaluma. who were as honour-bound to him as he was toNiqmepa. "

Simple forms of horizontal and transnational partnerships were alsofound in the Ugaritic and Ras Shamra texts. In what was known as acontract of uippuui, guilds and groups of Ugaritic merchants joined handswith counterparts in neighbouring principalities to finance tradingexpeditions to Egypt. Anatolia. Crete or Babylonia.-' Large mknn finns andeven the Crown itself became involved, the latter in a supervisory or evenparticipatory role. Princes like Niqmepa supported, oversaw and evenorganised joint public-private overseas ventures, An expedition organisedby the Prince of Byblos raised 540 shekels in silver, .SO of which werecarried in the ruler's personal sbip.'^ Maritime trading firms, or hubur, likeSinaranu's owned scores of vessels, were financed with royal and templesupport, and behaved as distant ancestors of Sumitojiio and Mitsubishi."Meanwhile, the staff of harbourmasters like Ugarit's Abiramu labouredunder the watchful eyes of the sakiiiu, or vizier, to play the mercantilist rolethat centuries later is seen in the activities of some government agenciessuch as Japan's MITI. regulating and assi.sting national commerce andrestricting foreign competition. Copper, lumber, shipbuilding and wheatwere designated as crown monopolies in the hands of state-directed hubur.'"Foreign merchants, or ubru. on the other hand, were to be strictly confinedto special quarters in the port cities and subject to strict supervision in their

ANCIENT PHOENICIA 23

importing, exporting and investment activities in an ancient version oftoday's non-tariff barriers.^^

The militarisation of Phoenician commerce would anticipate Sun Tzu bycenturies. Seaborne trade representing war by other means naturally led toits being organised and conducted on a military basis. Phoenician businessties with the armies and especially the navies of their principalities werevery strong. Admirals often doubled as merchants and were awardedpeerages and estates for their courage and service. Large fleets, sometimesconsisting of 100 or more round galleons and long warships were needed todeter piracy and minimise commercial risk. "The reason', arguesarchaeologist J.F. Raincy, for "this association between business agents andthe military is not hard to find. Mercantile enterprise ... was a dangerousadventure."-" Merchants were often murdered or abducled on their tradingventures, leading to Ihe creation of a body of treaty law protecting andsupervising their activities and involving private businessmen in diplomaticdelegations. In Phoenicia, as in many countries today, 'commercial,diplomatic, and military activity went hand in

There are good reasons to believe that Ugarit's form of managed feudal-commercial enterprise was both reproduced and perfected in other cities ofPhoenicia, such as Byblos, Sidon and Tyre. The papyms of the Egyptiantrader Wen-Amon spoke of an assembly of merchants in Byblos and royal{probably by the temple) control of the city's warehouses. The samedocument alludes to Ihe Bybliie shipping firm of Werket-Ef or Urkatel, whoowned a fleet of 50 vessels and wielded as much if not more power thanZakar-Baal, Prince of Byblos: 'As regards this Sidon ... are there not .'iOmore ships in it, thai trade with Werkct El and are dependent on hishouse?"" Prince Zakar-Baal himself described the royal Jurisdiction overthe Byblitc lumber industry: 'If I shout to Lebanon, the heavens open andthe logs lie at rest [on] the seashore!'"

Having established their own lucrative firms by the year 1000 BC, themerchants of Tyre rapidly began to outdistance all other Phoeniciantraders.'' Placed on an offshore island with a well-protected harbour. Tyrewas naturally endowed for long-distance maritime trade. The end ofEgyptian. Aramean and Philistine hegemony over southern Lebanon as aresult of the victories of Israel's King David, whose son. Solomon, becameTyre's ally, guaranteed the island city her independence and a stable climatefor her commercial expansion."

In the period between 1000 and 500 BC, the merchants of Tyre achieveddominance in, if not control over, international trade in the Near East, the

24 BUSINESS HISTORY

Mediterranean, and, for a time, even the Indian Ocean and its tributaries.Tyre's strategy of commercial expansion look place in three stages:

/. 1000-890 BC: The Preliminaiy Pha.se, based upon creation of abusiness partnership with a united Israel resulting in mutual trade expansioninto the Red Sea, Arabia. East Africa, and even India.

2. 890-840 BC: The Confinenfal Phase, based upon an attempt to makeTyre an Asian land power through economic and political union with Sidonand the kingdom of Omri in northern Israel. Trade and investment areredirected from Africa lo Israel. Cyprus, Anatolia, Syria, and a risingAssyrian power in Mesopotamia.

3. 840-538 BC: The hUercontinental-Mullinational Phase, based uponthe redirection of Tyrian trade towards Assyria and a co-ordinated wave ofcolonisation across the Mediterranean followed by massive expansion offoreign direct investment in a network of subsidiiiry enterprises spreadingfrom Spain and West Africa to Babylon.

The Preliminary Phase, 1000-890 BC, began with the creation of a vastlapputu-slyle partnership between the artisan-oriented economy of Tyre andan agrarian Israel. The Tyrian ruler, Ahiram 1, the famous Hiram of the OldTestament, obtained a stable food supply from Israel's granary; Solomonobtained valuable luxury goods, iron tools and industrial expertise.Phoenician smiths and craftsmen in Jerusalem and elsewhere engaged invalue-adding production on Israelite soil, exporting valuable knowledge inmining, metal-working, building and ship construction. Tyrian minersprovided the expertise to mine the copper of Edom and to construct ocean-going vessels on the site of what is now Eilat.'^ Tyre became 'a co-participant in Solomon's trade enterprises with other countries', her navaimerchant-princes being invaluable to Solomon's Red Sea-Indian Oceanventures "primarily because of their shipbuilding and sailing skill' '• Theshipping companies of Jerusalem and Tyre formed a partnership whoseoperations aimed at opening up a new Oriental market extending into theRed Sea and even the Indian Ocean. The fleets of HiratTi and Solomonimported gold, silver, ivory and precious stones from Arabia, Somalia andIndia."' The partnership also provided Phoenician firms access to overlandtrade routes, such as the Kings' Way east of the Jordan which linked Arabiaand Mesopotamia and other camel caravan routes which crossed theNegev.'' Profits reaped frorn the new Oriental market helped spur furthergrowth in the Phoenician and Israelite commercial infrastructures. Solomonconstructed palatial buildings, public works and acquired vast numbers of

ANCIENT PHOENICIA 25

chariot.s: Hiram, in addition to building vast shrines to his god. Melkart,reinvested many of the profit.s in building new shipyard.s and vessels."*Public enterprise played an imporlanl role in bolh the trading partnershipand the transfer of technology it inspired. Solomon is quoted in I Kingsrejoicing that "my servants will be with your servants' for 'there is no oneamong us who knows how to cut timber like the Sidonians*. Hiram, likeZakar-Baal, promised that his bus mlk (royal merchants) would bring thetimbers lor the Jerusalcin temple by sea from the forests under hisjurisdiction."'

The Continental Phase, 890-840 BC. of Tyre's commercial strategycame about as a result of the division of Solomon's kingdom into thenorthern House of Israel, eventually ruled by the dynasty of Omri from anew capital in Samaria, and the southern House of Judah, still ruled fromJerusalem hy the Davidic dynasty. This weiikening of Israelite powercreated a vacuum to be filled by Egypt. Aram-Damascus, and. mostimportantly. Assyria. Around 890 BC an ambilious High Priest of Melkart,known as Itobaal. seized the Tyrian throne and inaugurated the new strategy.With Judah no longer his ally and the Indian Ocean closed to Phoeniciancommerce. Itobaal and his merchants redirected investment much closer tohome, to Aram, Cilicia, Cyprus. Assyria and the more friendly Hebrewkingdom in Samaria. Surrounded by resurgent land powers. Itobaa] hopedto make Tyre a land power itself. Earlier business partnerships withmainland Phoenician states were transformed into a political union, at leastas far as Sidon was concerned. Formerly Prince of Tyre. Itobaal nowproclaimed himself King of the Sidonians as well.'" The ambitions of theruthless priest-king extended to the south as well. Betrothing his daughter.lezebel, herself High Priestess of the state cult of Astarte. to Israel's PrinceAhab, who became king around 890 BC, Itobaal hoped to integrate theSamarian kingdom into his political sphere, where it would serve as hisgranary.^' Phoenician direct investment flowed into the House of Israel,erecting buildings in Hazor and Megiddo. and planting a colony of artisansin Samaria. Producing the status goods so coveted by Israel's new Omridelite, the Samarian colony probably became the head office for a network oflesser Phoenician .settlements which dotted the wheat plains and shores ofNorthern Samaria and Galilee. Hurbat Rosh Zayit. Achzib. Akko. TellKeisan, Tell Abu Hawam, Shikmona. Tell Mevorakh and Tel Michalbecame the residences of Phoenician commercial agents charged withpurchasing and shipping Israel's grain/' Cyprus as well was drawn into theTyrian commercial orbit as a copper-mining centre. In Cyprus, Israel andPhoenicia, the presence of large Phoenician jugs side~by-side with Cyprus-made ware indicated the existence of a managed, internalised network ofcommercial activity linking the three regions.'' Itobaal's investors expanded

26 BUSINESS HISTORY

to the north and east as well, opening branch offices ul Myiandrios on theAnatolian shore, as well as Aleppo and Carchemish in Syria. Monumentsdedicated to Baal-Mclkart. Tyre's supreme god, found on bolh of the Syriansites, testify not only to the Phoenicians' presence in these regions but aneffort on their part to control the trade routes joining Anatolia's mines withMesopotaniian and Levantine markets.'^

The Melkart monuments highlighted the key role played by the cult andtemple of the bearded and horned Baal-Melkart in Phoenician business.Melkart {"King of the city') personified the ideal, all-powerful Tyrianprince. Gods and goddesses in Phoenicia were often worshipped as patronsof trade and technology, and even considered to be merchants ihemselves.^^Phoenician businessmen believed that Hayyin. Kothar, Astarte, andespecially Melkart blessed and supervised human commerce, ensured itshonesty, and cursed the violators of contracts. The supernatural sanctionsimposed by these spirits through their earthly representatives did much tounderpin the feudal keiivtsii-Vike strueture of the Phoenician business world.Supported by the state, temples were centres of trade, banking andwarehousing where priests notarised transactions and regulated weights,priees and measures. What merchant would wish to defraud therepresentatives of a god who might withhold the rain or destroy a galleonwith a windstorm.'"' The temple of Melkart was the cornerstone of Itobaal'scommercial strategy. When a guild of Phoenician merchants settled in aforeign country, their Urst project was to ereet a temple in the supremeBaal's honour. As Tyrian settlements multiplied in other countries, thetemple hierarchy also grew in size and prestige, itself taking on the structureof a multinational enterprise as the head shrines in Tyre acquired "hranchtemples in several cities'.^' Not only In Tyre, but throughout the Near East,loeal temples remained in constant communication with head sanctuaries.Goods and capital were transferred back and forth among them in a perfectexample of an internalised business hierarchy.*'

The hierarchy of Melkart would play an important part in internalisingthe transactions of international Phoenician business and in forging thetappulii partnerships so important not only to Itobaal's commercial strategybut that of his successors. When a Sidonian, Aramean or Hittite firm enteredinto a partnership with a Tyrian subsidiary, the rulers, merchants and eventhe population of the foreign state accepted the worship of Melkartalongside that of Hadad, Teshub and other native deities all seen asinterchangeable personifications of the powers of nature. Mergingcompanies" supernatural patrons underwrote and strengthened transnationalintertlrm co-operation. Paying homage to the power of Tyre's godsengendered the trust whereby huge deals could be negotiated andinformation and technology transferred.^" A religious partnership thus

ANCIENT PHOENICIA 27

helped seal an economic one. providing *a positive incentive for individualsor communities to reduce transaction costs by investing in the creation ofcommon gods'.^"

Quite successful in Cyprus. Hatti and Aram, with their long traditions ofnature-oriented polytheism, Itobaal's grand strategy was ultimatelyfrustrated by a religious revolution in Israel backed first by the prophetsElijah and Elisha and then by the nationalistic dynasty of Jehu whichmassacred the Melkaii hierarchy within Israel in a revolution which tookplace around 841 BC. Willing to accept their own state religion centred inthe shrines of Dan and Bethel. Israel's new rulers were monotheistic enoughto reject homage to the Tyrian Melkart cult, thus dooming any closerpolitical alliance or merger between Samaria and Tyre."

VI

The climactic Intercontinental-Multinafional Phase. 840-538 BC, of Tyriantrade and investment expansion began on the heels of Jehu's revolt andculminated in the period of the Neo-Assydan Empire in the eighth andseventh centuries BC. Phoenician investment not only flowed into As.syriaand Babylonia hut even reached across the central and westernMediterranean to North Afriea and the Atlantic eoast of Spain. The rise ofAssyria was the major catalyst of the new Phoenician strategy. In the daysof Itobaal, the armies of Ashurnasirpal II and Shalmaneser HI marchedwestward across the Euphrates, exacting tribute from terrified Phoenicianrulers.'- The Assyrian presence became much more immediate after 733 BCwhen the armies of Tiglath-Pileser 111, Shalmaneser V, Sargon II andSennacherib conquered Syria and Israel. Assyrian influence over Phoeniciareached its peak under Esarhaddon (680-69 BC). Mainland Phoenicia wasdivided into three Assyrian provinces called Simya, Sidon and Ushu, andmany of the inhabitants were deported. Tyre kept her independence, hutonly under the harsh terms of a vassal treaty dictated by Esarhaddon to theTyrian Prince Ba'alu. The treaty confirmed the position of the Assyriangovernor in Tyre itself and listed the ports through which Ba'alu'smerchants were permitted to trade/' The text of the treaty, drawn up in thepresence of various priests, illustrated the nature of business in the 'feudal'and even magical Phoenician world. According to its terms, any violationson behalf of Prince Ba'alu would call down the wrath of various storm-godsraising an evil wind against Tyre's ships, sinking them in the sea;'

These are the ports of trade and the trade roads which Esarhaddonking of Assyria [granted] to his servant, Baal: [to wit] toward Akko.Dor, in the entire district of the Philistines, and in all the cities within

28 BUSINESS HISTORY

Assyrian territory, on the seacoast, and in Byblos. [across] theLebanon, all the cities in the mountains, all the cities ... whichEsarhaddon gave Ito] Baal ... Ito] the people of Tyre ... in their shipsor ail those who cross over, in the towns of IBaal], his towns, hismanors, his wharves, which ... to ... as many as did lie in ihe outlyingregions, as in the past ... they ... nobody should harm their ships.Inland, in his district, in his manors ..."

Assyria's efforts to monopolise Tyre's trade with the rest of Asia,ironically, permitted Phoenician commerce to seduce even the might ofNineveh. Assyria's landlocked kings left their western trade in the hands ofthe people who knew and managed it best, be they settlers or deportees. Afirm run by the Sidonian Hanunu became chief supplier of the Empire'sdyed fabrics: Oubasti. exiled to Nineveh by Sennacherib as a youth,became the city's chief porter.'*' The eastern network of merchants,organised in the time of Itobaal. in Cilicia. Aleppo. Carchemish and noweven Nineveh and Babylon continued to ship goods to and from pointswest, leaving them in the hands of Phoenician companies, their partnersand subsidiaries." The Tyre-Nineveh partnership followed a commercialpattern established centuries before, when Babylonian and Ugariticmerchants joined hands to finance large-scale trade between Mesopotamiaand the West. Bulk shipments of metals, textiles, foodstuffs and processedgoods, including purple dye. plied up and down the Euphrates and crossedSyrian mountains and plains, paid for in silver and textiles by consortia ofCanaanite, Babylonian and Assyrian merchants. Babylonian and Assyrianfirms and their employees formed price-fixing partnerships to purchasePhoenician goods and distribute them to their subcontractors. Temples ofAshur. Marduk and Melkart provided capital, direction and storagefacilities, hi the eighth and seventh centuries BC, Babylonia was now avassal of Assyrian kings using the Euphratean trading system for their ownends. Tyre became Assyria's source not only of huge quantities of dyedgarments but also silver and iron. Lacking the iron deposits needed to equiptheir vast armies or the silver to finance them, the kings of Nineveh turnedto their Tyrian vassals and clients to supply them, much as Germany in theSecond World War turned to Sweden for iron ore and Switzerland for hardcurrency.^"

Assyrian control of Near Eastern markets and resources encouragedTyre's merchants to embark upon an ambitious new strategy. BecomingNineveh's supplier and banker preserved Tyre's independence whileguaranteeing ii a vast market on the Assyrian-held mainland. The potentialprofits from selling precious metals, raw materials and finished goods to theAssyrian Empire in bulk were sufficient to justify creation of the first

ANCIENT PHOENICIA 29

intercontinental multinational enterprises. The advanced stage of Tyriancommerce and its relationship with Assyria offered Tyrian firms ju-st theright combination of advantages, described in Dunning's eclectic paradigm,to make mullinational investment on a larger scale than ever beforeexpedient and profitable. Tyre's firms possessed ownership-specificadvantages in the form of the finest tnerchant marine in the world, the skillsof its sailors, smiths, financiers and a powerful, well-organised network ofshipping and trading companies, supported by both the crown andsupervised by a multinational temple hierarchy. The location-specificvariables were also favourable for the creation of a sea-based empire: beingheadquartered on an almost impregnable island witb direct access to theports, trade routes and resourees of three continents were ideal for any firmsinterested in overseas inve.stment. Most importantly, the ability of Tyre'sbusiness establishment to invest abroad on a large scale in the form ofmanaged hierarchies and partnerships provided intemalisation advantagesover Greeks. Egyptians or any other potential competitors. Unlike theseothers, Tyre's business establishment, directed by the Melkart hierarchy,would possess suffieient capital to minimise risk and circumvent marketfailure through its state-supported merchant fleets.

In accord with the advantages outlined in Dunning's eclectic paradigm.Tyre's managers expanded their trade and investment across theMediterranean. While this strategy bore its greatest fruit after 750 BC andespecially alter 680 BC, the seeds had been planted in the reign of theTyrian Princes Mattin (840-32 BC) and Pumayyaton (831-785 BC). Thehistory of Japanese expansion in the nineteenth and twentieth centuriessuggests a pattern of how the economy of Tyre must have expanded as well.The feudal strueture described by Abe and Fitzgerald had been in place formany centuries before the great commercial expansion, aided by a risingmonarchy, began. The takeoff industry in 1870s Japan appears to have beentextiles, in the form of both cotton and silk. Similarly, in Phoenieia it wasdecorative garments, primarily the miirex purple. By the I92()s in Japan andthe Late Bronze period in Phoenicia a competitive textile industry was nowjoined by shipbuilding. The shipyards of Tyre were as impressive in theirday as those of Nagasaki and Kobe are today. By the 1940s in Japan and thetime of Hiram in Canaan metalworking and productive manufacturing hadbecome significant.'"^ Temporarily derailed by the Second World War, theclimactic period of Japanese commercial expansion was in the 1950s and1960s, to which a rough parallel can be drawn to the Phoenicia of 9(X)-6(X)BC which likewise was weak in agriculture but strong in textiles, mining,manufacturing (on a smaller and more primitive scale) and capitalinvestment. By 1964 in Japan the percentage of people working inmanufacturing exceeded those involved in agriculture, forestry and fishing.

30 BUSINESS HISTORY

a trend which must have taken place at some time in Phoenicia also,probably after the Iberian metals boom taking place after 750 BC. Growthin hoth places rested upon an uneven development of textiles and specificindustries, while much of the rest of the economy remained frozen in time.In both cases, specific clusters of industries - textiles, metal manufacture,shipbuilding, mining and finance - would empower the national economyas a whole.* '

Built around the temple of Astarte and ruled over by a prince of theTyrian line, Kition in Cyprus served as the mode! for the overseasPhoenician branch offices to come. New settlements of metallurgists sprangup all across the island, at Golgoi. Idalion. Tamassos, Marion and Capcthos,processing ihc copper from the island's mines. Privately employed, thesecoppersmiths nonetheless worked in a temple-supervised keiretsu-stylerelationship with larger firms.'' Known as Qart-Hardasht or 'New City'.Kition was logically positioned to serve as both an embarkation and adistribution centre for the newer colonies to the west. The most famous ofthese, founded in Tunisia around 814 BC, also bore the name of Qart-Hardasht. suggesting some possible connection. Better known as thefamous Carthage, this African colony, with its sister settlements of Uticaand Hadrumeto, was placed to control the wheat-fields of North Africa,which, sale from invading armies, would replace Israel as the Phoenicianbreadbasket.'''

Other Tyrian settlements were founded, between 830 and 800 BC. on theEuropean side of the Tunisian Straits, on the islands of Pantellaria,Lampedusa, Gozo, Malta, Sicily and Sardinia. Temples to Melkart wereerected on the harbour-islands of Motya, off the northwestern coast ofSicily, and Sulcis, off the southwestern coast of Sardinia."' As in the East, soin the West did the temple operate as the major institution in directing tradeand investment:

In distant places where he | Melkart | possessed a temple, his functionwas a very concrete one: to ensure the tutelage of the temple of Tyreand the monarchy over the commercial enterprise, thus converting thecolony into an extension of Tyre, and also to guarantee the right ofasylum and hospitality which, in distant lands, was equivalent toendorsing contracts and commercial exchanges.*^

The still relatively undeveloped central Mediterranean settlementswere but overtures to a much more important investment in the land ofTarshish, located in the southern part of the Iberian peninsula. Encouragedby a sacrificial omen, Phoenician traders in search of access to 'the mostabundant and most known sources of silver' in the ancient world erected avasl temple to Melkart on the island site of Gades (Cadiz) in the mouth of

ANCIENT PHOENICIA 31

the Guadalquivir.'' The Spanish operation was poised to become the mostimportant subsidiary in the entire Phoenician trading network. Long beforePhoenician longboats and galleons reached the distant Spanish shores,native Iberians using crude stone tools were mining the vast silver lodes ofthe Huelva region."" The greatest deposits of all in this region, not far fromwhat is now Portugal, lay on the shores of the Rio Tinto. Here, at a placecalled Corta del Lagc archaeologists in the 1970s would uncover evidenceof a massive growth in silver production beginning around 800 BC. Thediscovery of new iron tools. Oriental smelting techniques, and moresystematic mining practices, together with large numbers of Phoenicianjugs not unlike those found in Lebanon, Cyprus and Palestine showed thatthis primitive Iberian industrial revolution coincided with the coming ofthe Phoenicians and their transfer of technology and advancedtechniques.''^

Destined for a huge new market, vast quantities of silver ore floateddown the red waters of the Rio Tinto to the furnaces of Huelva, whereIberian smiths turned them into ingots and sold them to the Phoenicians.Other silver went overland from the mines of Azfialcollar near Seville toanother group of furnaces at San Bartolome de Almonte for processingbefore shipment to Gades. These two routes were not competing enterprisesbut complementary operations in a new Iberian business consortiumcapable of co-ordinating mines, foundries and ports. Growing Phoeniciandemand for silver required more Iberian miners, more personnel to organise,house and supply them, and more teamsters to ship their ore to the sea. Thiswould have been impossible without the rise of a new business class inIberia which now formed its own organised hierarchy capable of bringingan expanding mining industry under its internal sway.*^ The new Iberiansilver enterprise probably adopted an organisational form similar to thai ofits new Phoenician trading partner, which still managed overall operationsfrom Tyre itself:

What is more, the traffic in silver ore ... implies, in addition toconsiderable economic investment, a high degree of coordinationbetween the mine and the wharf, such as the existence of an authoritylo centralise and coordinate these services. Given that the chiefbeneficiary was Tyre, we are bound to think, as the classical sourcesfrom Diodorus (5:35:5) insinuate, that Gades was acting under ordersfrom Tyre by way of powerful commercial agents installed in thewest.''"

32 BUSINESS HISTORY

vnThe growth of the Phoenician/Iberian silver consortium would eventuallystimulate investment all along the entire Phoenician Mediterraneannetwork. Whether founded before or after Gades. the settlements of thecentral Mediterranean and elsewhere would definitely prosper as a result ofthe silver trade's growth: 'And the result was that the Phoenicians, as in thecourse of many years they prospered greatly, thanks to commerce of thiskind, sent forth many colonies, some to Sicily and its neighbouring islands,and others to Libya, Sardinia, and Iberia."" New settlements were foundedin southern Spain, Africa, Sicily and Sardinia, whose growlh and prosperitywas linked to the Tarshish trade. These eolonies, each of which wassupervised by a naval and temple hierarchy responsible to the head officesin Gades, Kition and/or Tyre itself, became important bases in a battle foreconomic survival with powerful military implications. The sailor-merchants of Tyre considered the central Mediterranean subsidiaries 'aresponse to certain basically strategic imperatives'.'' The head offices inGades, Moyta and Sulcis were all planted on secure harbour-is lands whichresembled Tyre itself. As the Tyrian relationship with Assyria developedand the mining of silver in Spain intensified, the central Mediterraneanoffices began to grow and prosper as a direct result.'- The Sicilian office inMoyta, based around its temple and sparsely staffed until about 650 BC,experienced thereafter a period of direct Tyrian investment in the form ofMarge industrial complexes and warehouses' suggesting 'the earlyappearance of specialised industries - iron and purple'." Sardinia was morethickly settled. Tyrian activity was at first confined to Sulcis under the civilrule of the shrine of Melkart until the army won trading rights forPhoenicians on the island. After 700 BC a new wave of Tyrian settlementdominated by soldiers, sailors and merchants spread over the southern halfof the island, erecting a fortifiedbelt of settlements at Salcis. Nora, Cagliari,Bythia, Carloforte and Thairos.^' The systematic creation of a half-dozenseaports and merchant colonies, in close proximity to one another on thesouthern coast except for Thairos indicated that the Tyrian subsidiary inSulcis and those directing it far to the east were pursuing a "genuineterritorial strategy ... of controlling the hinterland".'"

Given the need for massive capital investment and direction to sustainall of these settlements and their activities, the existence of a market-oriented but royally directed business organisation supervising and co-ordinating them is highly plausible. Excavations on Sardinia showed anorganised pyramidal relationship among the Tyrian colonies on the island.Founded as a naval base and way-station, Sulcis eventually became thesubsidiary head office of a Tyrian mining operation extracting Sardinian

ANCIENT PHOENICIA 33

.silver and lead deposits. The large military presence in these coloniesdemonstrated royal accountability of the merchants first to Sulcis, then toKition or Gades, and eventually to Tyre itself. The presence of a singletemple of Melkart and burial ground in Sulcis was a sign of the overlordshipheld by the priests and merchant-princes of that city over the othersettlements on the island until a second cemetery was erected in the interiorafter 400 BC."

Phoenician investment developed in Spain as well, Gades and otherGuadalquivir settlements being followed by a new strip of Phoeniciancolonies which flourished along the Mediterranean shore of Andalusiabetween 750 and 500 BC. The site of Toscanos, in particular, yieldedabundant traces of direct investment and even value-added productiveactivities by the Phoenician coloni.sts.^' Phoenician Red Slip ceramics wereproduced locally in these settlements rather than being directly importedfrom TVrian factories. Even more important in these colonies was thepresence of metal-working industries, where the residents turned the ore andingots of the Iberian mines into finished luxury articles and tools to be soldback to the natives, who provided a fine market for Canaanite ceramics,artwork, handicrafts, jewels, ivory, caskets, combs, statues, altars andamulets imported from Phoenician offices both in Spain and abroad.'** Muchinvolved in trade with the Spanish interior, the Andalusian colonies alsoimported and probably processed ivory from Africa and tin from the BritishIsles. The warehouse at Toscanos was too large to satisfy local subsistencealone. More likely, it served as a terminal for Spanish silver shipped by roadfrom the mines of the Sierra Morena, tin from the North Atlantic, andPhoenician goods going to and fro across the Mediterranean."' The tombs ofMorro de Mezquitilla. immediately to the east of Toscanos. providedstriking confirmation that this trading and value-adding activity wasdirected by a local Ibero-Phoenician management with family ties to Tyreitself/"

The richer tombs of Morro de Mezquitilla belonged to the elite of thecolony, leading British archaeologist Richard Harrison to surmise ihat theywere 'probably from important trading families who headed the firms thatwere based in Tyre and Sidon"."' Linking the Atlantic tin trade with Tyre'sMediterranean hierarchy, the trading sphere of the Toscanos subsidiarycolonies covered not only much of western Europe, but even included partsof West Africa. Pottery finds linked the Andalusian colonies with newTyrian colonies on Rahgoun Island, Lixus and the Isle of Mogador, off thecoasts of Algeria and Morocco, which managed the gold and ivory trade ofGuinea and other points in sub-Saharan Africa."'

34 BUSINESS HISTORY

VII

By 650 BC the Prince of Tyre, the high priests of Melkart. and the viziers,harbourmasters and merchants under their tutelage presided over the mostimpressive business organisation in antiquity. Managed by an internationaltemple hierarchy which cemented the kein'tsu-^\y\e relationships amongTyrian firms and their foreign trading partners, the unified Tyrian businessorganisations were able to internalise trade and production on an axisstretching from the Atlantic shores of Spain to the shores of the BabylonianEuphrates. The lucrative Spanish firms, jewels in Tyre's imperial crown,were now closely integrated with the island firms of the centralMediterranean. A Canaanite tomb discovered at Ghajn Ouajjcd in Maltacontaining a horde of Spanish silver pointed to the Maltese subsidiary'srole as a way-station linking the Gades and Toscanos operations with thoseof the home country."' The "mini-Tyres' of Sulcis and Moyta, besidesdirecting the Sardinian and Sicilian subsidiaries, also served as 'ports ofcall on the routes of Phoenician ships coming into the westernMediterranean in order to transport metal to .sell in the marketplaces of theNear East'."' Kition. headquarters of the Cypriot-Aegean subsidiaries,became the key entry-point for Mediterranean silver, wheat and goodsentering Asia itself as well as the key departure-point for Asian goodsheading west. Artefacts from Egypt and Mesopotamia reached Spain viaPhoenician-controlled ports and most likely Kition, and it is very probablethat the popular Phoenician Red Slip ware in Spain first came from theTyrian enterprises on Cyprus:

Spain communicated with Phoenicia both directly and throughCyprus's mediation, probably on this island originated the redceramics technique. A number of parallels are found between theobjects of Hispano-Phoenician and Cypriote arts. Some originalCypriote objects were discovered in Spain."'

TTie regular contacts between Cyprus and the western operations and keyrole of Kition in the latter was noted as well by the most famous of allHebrew prophets. Warning of Tyre's doom, Isaiah, then a royal prince in thecourt of King Hezekiah of Judah in Jerusalem, painted a picture of the city'sfuture destruction and its impact on the overseas empire. Galleons plyingeastward from the Iberian mines and factories reaching Cypais would therelearn of Phoenicia's demise and the consequent economic ruin of both Iberiaand Kition: "Wail. O ships of Tarshish: for Tyre is destroyed, without houseor harbour; it is reported to them from the land of Cyprus'."''

Our contention that the business establishments of Tyre's overseascolonies functioned as branch-plants and foreign subsidiaries in an

ANCIENT PHOENICIA 35

intercontinental multinalional setting is supported by several archaeologists,including T. Jiidice Gamilo:

The structure of the Phoenician settiemenls was linked with thehomeland mercantile 'companies', in a family based organisation,which might have been operating in town.s like Ugarit or Tyre. Someof these "companies" possessed large numbers of ships ... [which]would provide the capital for their trading activity ... as sponsoringand protective private Institutions. // was indeed a private enierpri.se,owned by traders, who organised Iheir workforce, ships and voyages.The traders seem to have had a high status and an equally highpolitical rank, based on a kinship organisation. ... This aspect isfurther emphasised by the Old Testament references to the Phoenician"household" and Moscati also mentions the textile industry developedat Carthage, which apparently was based on "family lines" too.'"

The British archaeologist Richard Harrison is even more explicit in hissupport, describing both the iamily-based .structure and the inlernalisationadvantages which Tyre, Inc. possessed:

The pattern of Phoenician trade was linked to .specialist productioncentres, connecting different areas and political systems whichotherwise would not have been drawn together, and establishing a rateof exchange much to their own advantage. They could do this fairlyeasily since they had a monopoly on both the specializedmanufactures that everyone desired, and the marine transport, so theycould stimulate demand where they chose to do so. A virgin marketwa.s the ideal since it could be scoured hard for huge profit.s; thisaccounts for their interest in Spain, especially in the silver minesbehind Huelva in the Rio Tinto. and near C^stulo in the SierraMorena. The Phoenicians were able to locate new metal sources, andunlock the wealth from Ihcm. unhindered, for a century and a half.

The traders worked through a system of Phoenician family firms,who had representatives in their home town in the easternMediterranean as well as in their new markets and factories; theyowned their own ships, too, and were prepared to take risks whichtheir overlords could not well calculate, or were unwilling to do. andso profited greatly.*"**

IX

In the course of this article we have suggested a few similarities betweenPhoenicia and modern-day Japan. The similarities between Phoenicia and

36 BUSINESS HISTORY

today's Japan were economic as well as religious and social. Both wereforested, densely populated, urbanised nations compelled to seek prosperityon the high seas. Enough of a parallel exists between these two societies tosuggest describing the Phoenician economy a.s an early form of East Asian'producer' capitalism bearing somewhat of a resemblance to the modernJapanese keiretsu system. Boundaries between public and public enterprisewere fluid. Large firms formed honour-bound subcontracting relationshipswith smaller ones on the basis of feudal loyalties. A royal state, a state-runpriesthood, an aristocratic military and a rising business class co-operated inthe long-term pursuit of the collective national interest. Trade itself was notviewed as free play among individuals but as part of a battle for nationalcommercial survival and supremacy in which each trader was an economicknight/soldier with his dutiful role to play for his city's prince and gods.Ugarit and Tyre as well as Japan had a very pragmatic approach toeconomics marked by 'the absence of a strong anti-business ideologyamong government officials or anti-government sentiment among businessleaders'."''

X

Even from the perspective of 3.000 years, Phoenicia's achievements, andespecially those of Tyre, are considerable. Based upon a smal! island withno natural resources. Tyre's merchants, guided by resourceful priests andprinces, adapted the Phoenician model of integrated businessestablishment pioneered in Ugarit and embarked upon an ambitious quasi-military global trading strategy, centuries ahead of its time, that resemblesin some ways keiretsu capitalism of modem Japan. At its peak, theexecutives who directed this intercontinental enterprise traded in silverfrom Spain, tin from Britain, ivory from Africa, copper from Cyprus, ironfrom Syria, and textiles and manufactured goods from all over theMediterranean. Their investments reached from the Atlantic to the core ofthe Assyrian Empire. Impressive as it was. Tyre's system was not eternal.Dealt a severe blow by Nebuchadnezzar's Chaldean Empire around 600BC and conquered by Alexander the Great in 33 i BC. Tyre and its empirefaded from the scene. New iron-working technologies empowered bothGreece and Rome, enabling tbem to supplant both Tyre and its successor,Carthage, while pioneering a more individualistic form of businessorganisation. Mesopotamia would never again be the centre of world tradeor the major source of foreign direct investment. Though Tyre's domainwas dissolving, the island city had shifted the heart of world trade toelsewhere in the Mediterranean, where it would remain for a millenniumand a half

ANCIENT PHOENICIA 37

A Study of the growth and triumph of Phoenician business networksbased upon the above evidence is nevertheless valuable for several reasons.It demonstrates that the multinational corporation is not necessarily a newdevelopment, but is several thousand years old. The close, honour-basedhorizontal and vertical relationships among Phoenician firms, theirbrancbes, subcontractors and the public sector represented by prince andpriest demonstrate as well some important aspects of some fornis of today'scapitalism. Finally, the impact of Tyrian investment in not only Israel but inSpain, where it inspired a technological revolution, social differentiations,and even nationalist reactions to what really was a primitive form of'regionalisation' provides a fruitful area for further study.

NOTES

1. This material is adapted from a f'onhcoming book by the same authors. Birth nf theMuUinational: 2000 Yecir.i of Ancieiii Biisines.s History - From Ashur to Augustus, lo bepublished hy the Copenhagen Business School Press.

2. J. Dunning. Multhiutitiunl Enterprises and The Global Ecorwmy (Wokingham. 1993). p.96.3. For example in W. Roslow. Ihe World Eronomy: Hi.Ktory and Prospect (Texas. 1978); D.

Nonh, Structure and CJumi-e in Economic History (New York, 1981); A. Chandler. Scaleund Scope: the Dynamics of Industrud Capitalism (Cambridge. MA. 1990); J. Powelson.Centuries of Economic Emteavor (Ann Arbor. MI. 1994).

4. For example. I.. OfWn. Assyrian Colonies in Cuppiidociu (The Hague. 1970); M. Larsen. TheOld Assyrian City-Staie and Its Colonies (Copenhagen. 1976); M. Aubct, The Phoeniciansand the We.\l: Politics. Colonies and Trade (Cambridge, 1987).

5. Dunning. Multinational Enterprises, p.3.6. Two olher importanl theories which seek to explain foreign aclivilies of firms are the

inlernalisation iheory of the MNE: for some key works in ihc area, see P. Buckley and M.Casson. The Future of the Multination<d Enterprise (London. 1976); J. Hennari, A Theory ofMultinational Enterprise (Ann Arbor. MI, 1982); aiid for ihe macro-economics iheory offoreign direct invesimeni hest represented hy Kojima. see his 'Reorgani/ation ofNorth-South Trade; Japan's Foreign Economics Policy for the 1970s', Hitoiuha.shi Jourtjolof Economics. Vol.23 (1973), pp.630-40. and K. Kojimu. 'Japanese Direct InvestmentAbroad'. Social Science Research hmitute Monograph Series I (Tokyo. 1990).

7. For an further discussion of internalisation advantages, see Buckley and Casson, The Futureof the Muhinational. and C. lelto-Gitlies. International Production: Trends. Theories. Effects(Oxford. 1992).

8. P. Buckley, "The Role of Management in Internal isation Theory'. Management InternationalReview. Vol.33 Na3 (1993). p.l98.

9. letto-GilUes. International Production, and Dunning. Muhinational Enterprises.10. A. Rugman. 'A New Theory of the Multinational Enterprise; Intemaiionalization versus

lntemalization', Columbia Journal of World Business. Vol.29 (Spring 1980). p.26.11. Ihid.. A New Theory: M. Casson, Vie Finn und the Market (Oxford. 1987); letto-Gillies,

Interniitional Production.12. A. Rugman and M. Geslrin. The Strategic Response of Multinalional Enterprises lo

NAFTA", Columbia Journal of World Business. Vol.28 (1993). p. 19.13. J. Dunning. 'The Glohali^ation of Firms and the Competitiveness of Countries; Some

Implications for ihe Theory of International Production", in J. Dunning (ed.). Globalization

38 BUSINESS HISTORY

of Firms ami The Competitivettess of Nations (Lund. Sweden. 1990).14. Riigman anil Gestrin. The Srnircfiir Response, p. 19.15. Dunning. The (ilohulizution nf Finns.16. K. Moore ;ind D. Lewis, 'Tlie First MNEs: Assyria Circa 2000 B C . Maiuigement

Inicnumonul Review. No,2 (1998).17. A. Kuhrl. The Ancient Near East. Volume I (London, 1994). p. I i 1.IS. Stale-owned muliinaiional enterprises (SOEs) were a growing phenomenon unlil the mid-

1980s. In 1965. 19 of [he world's largesi 200 industrial enterprises outside the US wereSOEs: by 1985 ihere were 35 on the same list, ineluiling 18 foreign direci investments.Dunning. Mullinarioniil Enterprises. pp.4()-.'>0. Few would qiicsiion these TinTis as being•real" MNEs.

ly. R. Cliflbrd. 'Phoenieian Religion". Bulletin nf the Americnn Schools of Orienml Research.No.279 (August 1990). pp.55-64: D. Harden. The Phoenicians, pp.82-6.

20. Aeeording to Etsun Ahe and Rohen Rtzgerald. Japanese society is an ideal arehelype of thismodel: 'Just as individuals were linked to families, lamilies were linked to villageeommunities. and village comtnuniiies looked to Iwal lords tor proleclion and favour, just asloeal lords itHiked to the Tokugawa shogunale. Consequently, hierarchiea! connections had apolilical and tnililary purpose as well as an economic and social one. and. within this"vertical society", membership of a group became closely lied to personal identity." K. Abeand R. Fitzgerald. "Japanese Economie Success". Business History (1995). p. II.

21. M. HcUzcr. 'A Reeently Discovered Phoenician inscription and the Prohlem of the Guilds ofMetal-Casters". Atli del I Con^resso Intermiziomtle di Stmli fenici e puniei. Roma. 5-10Novemhre t'^79. Rome. Consiglio Nazlonale della Ricerche. 3 vols: VoM. pp. 119-23. 124.135. Abdihaqah is thought to have lived around the period of 1100-1050 BC.

22. Heltzer. "Phoenician Inscription'. p.i36: E. Linder. "Ugarit. A Canaanite Thalasswracy". inG.D. Young (ed.). Vfiurii in Retrospect: Fifty Yeur.s of Ugarit and U^aritic (Winona Lake.Indiana. 1981). p.35: A.F Raincy. "Business Agents at Ugarif. in Young (ed.). Ugarit inRetrospect, pp.313-21.

23. Heltzer. 'Phoenician In.scription". pp.140-42.24. Ibid., pp.142-3. 147: Linder. -Ugartt'. p.35.25. According to Y Kunio, the Japanese "government is an important souree of funds' for the

trading companies, including low interest and relief loans without which many of theirventures might he unproHtabte. Y. Kunio. Sof^o Sho.sha: The Vanguard of the JapaneseEconomy (New York. 1982). p.275.

26. Linder deserihes the grain enterprise as •monopolized by the king and shipped by his fleet",•Ugarit'. p.33.

27. Heltzer. Phoenician Inscription", pp.135-7.28. Rainey. "Business Agents'. p.3l4.29. Ibid.. p.3I5.30. "The Journey of Wen-Amon to Phoenicia', text in M.E. Aubet, Phoenicians and the We.u

(Cambridge. l99Ci). Appendix II. p.2y8.31. According to M.E. Aubet. "The presence of the powerful Urkatet suggests thai there may

have existed in Phtienieia from earliest times a highly developed private commeree.operating in circles very close to the palaee or dircetly subordinate to the royal house. In thatcase, the hubur might be organised corporations or shipping consoriia running a regular tradebetween the Phwnieian coast and Egypt and operating with complete autonomy under theprotection nf a wealthy man'. Aubet. Phoenicians and the Wesr. p.93.

32. R.R. Stieglil/. "The Geopolities of the Phoenician Littoral in the Early Iron Age". Bulletin ofthe American Schools of Oriental Research. No.279 (August 1990). p.l I.

33. Aubet. Phoenicians and the We.\t. pp.27. 29-32. 35.34. I Kings 5:11: Sabatino Moscati. The World of the Phoenicians. English translation by

Alastair Hamilton (London. 1968). p. 13-35. M. Elat. The Monarehy and The Development of Trade in Ancient Israel", in E. Lipinski

(ed.). State and Temple Economy in the Ancient Near East. Proceedings of ihe Internationa!

ANCIENT PHOENICIA 39

ConTerence organised hy the Kalholieke Universiieii Leuven. 10-14 April 1978 (Louvain.Belgium. 1979). p.5.'*7. Hlal also records ihal "The Sidoniuns were expert sea traders and. LISwe leam Iroiu the reporl of Wenamun. even hud a special association of niiiritime nierchant.sealled Huhur . Phoenician maritime skills were likewise laterexported lo the Assyrians, whoemployed Sidonians to huild and ruan their trading and war fleets in the Persian Gulf (p.537).The Gold of Ophir menlioned in II Chronicles 20:35-7 probably came from the west andsoiiih of the Arabian peninsula, the Egyptian Desen or even further south in Africa in ihepresent country nf Sudan (p.539).

36. According lo Aubet. the Israelites noi only obtained Phoenician technology, but also imitatedPhoenician bu.siness practices, setting up trading companies on ihe Tyrian model. Aubetclaims I Kings 22:48 and I Chronicles 20:35 refer to 'a Phoenician model of a merchants'consortium traditionally used for joini large-scale shipping enterprises under the protectionof the monarchy. The profits or losses in an enterprise of this kind could be so high that ilwas necessary to Join forces under state management'. (Aubet. PlwfiiicUins mid ihe IVcvf,p.92l.

37. "Solomon controlled ihe trade routes and Ihe countries over which the Arah camel caravansthen travelled on their way to the lands of the Fertile Crescenl. Without Solomon's co-operation, the Arabians could not be assured of the regular conduct of iheir trade.' (Elat,'Ancient Israel", p.526).

38. Auhci. Phncniriiins mill the lVf'.vf. p.36.39. I Kings 5:6; Moscali. WiirUIof ihc Phticiiiciuiis. pp.I2-13.40. Itohaal was the "Ethbaa! king of the Sidonians' mentioned in I Kings 16:31. Sabatino

Moseati mentions that ihe fragmentary annals of Tyre describe him as a usurper-priest ofAstarte who seii ed the TyHan throne after a period of civil war con-esponding to a similarcivil war in Israel between the followers of Omri and Tibni. Where Hiram had been King ofTyre only. Itobaal became King of the Sidonians. or King of Tyre and Sidon. F-ounding a newdynasty in Tyre. Itohaal tried to extend that dynasty into both Israel and Judah hy marryinghis daughter Jezebel into the House of Omri and his granddaughter. Athaliah. inio ihe Houseof David. Moseati. World of the Phoeniciuns. pp.14—15.

41. "Israel was Tyre's main source of agricultural produce." Blai. 'Ancient Israel', p.537.42. 'Atcoaslal settlements ... sueh as Achzib. Akk(vTell Keisan. Tell Abu Hawam. Dor and Tell

Miehal. the material culture of the period is distinctly Phoenician." E. Stern. "New Evidencefrom Dor for the First Appearatice of the Phoenicians along the Northern Coast of Israel".Biillfliii of till- Anwrirun Schooix of OrieiUul Reseiinh. No.279 (August 1990). pp.29-30.See also Z. Gal. "Hurbat Rosh Zayil and the Early Phiwnician Pottery". Levuiil. Vol.XXIV11992). pp. 173-8.'i. It should be noted Ihat orthodox chronologies date these settlements tothe period of around 1050 BC. placing them during King Saul's reign rather than .\hab"s. Anew compressed chronology, however, championed by several 1990s archaeologists, redatesmany of the early Phoenician Tmds and places these settlements in the tenth and nintheenturies BC. See P. James, l.J. Thorpe. N. Kokkinos. R. Morkoi and J. Prankish. Centuriesnf Darknc.-i.s: A Cludtetifie ro ihe ConvenlUmal Climnoloi'y oJ Old World Animeology.foreword by C. Renfrew (New Brunswick. NJ. 1993). pp.186-96.

43. Even though he adheres to the orthodox dates. Stern notes that "The parallel phenomenon ofthe pottei-y found at Dor (as well as at Tell Ahu Hawam. Tell Keisan. Tyre. Sarepta, andKhaldeh on the Phoenician coast, and elsewhere) and in Cyprus seems in faet lo representtwo sides of the same coin: the beginning of Phoenician expansion and settlement on thenorthern coast of Palestine and in Cyprus." ("New Evidence', p.32).

44. 'Thanks to a network of factorships and trading posts in place in the Gulf of .Mexandrettaand the coastal region of Cyprus, Tyre was able to secure a monopoly of the trade in meialsand slaves in Cilicia. the Taurus Mountains, and ihe Euphrates and. at the same lime, tocontrol the sea routes to Cyprus and Crete.' (Aubet, Phoeuiciiim and ihc We.ti. pp.40-41).

45. The Baal Epic in the Ras Shamra texts praises the Bitul Hayyin as patron of all Canaanitemetalworkers: 'Hayyin would go up to the bellows ... To melt silver, to beai oui gold.' SeeJ.B. Priiehard (ed.). AncienI Near Ecislerii Te.xts Rekili/ii; to ihi' Old Testciitieril tPrinceton.

40 BUSINESS HISTORY

NJ, 3riJ cdn. 1969), p.l34. This crat'lsnian-god. also worshipped as Kolhar, was even moreinvolved in ihe market, huilding palaces lor Baal from the tcdars ol' l,chan<in and Iradingacross the lx;vani and the Aegean: 'There now. he off on thy way ... lo Kaphlor. the thronethat he sits on. Hikpat the land of his portion' (p. 138).

46. M. Silver. Economic Stniclures of Antiquity (We.stpon, CT. 1995). pp.6-7, 18-19, 25-7.47. Ibid.. P..32.48. 'In explaining financial connections among cults or administrative controls of one cult hy

another or the sharing of temples or the merger ol* cults or temple complexes, the economistwould of cotirsc be inclined to stress explanations in terms of efficient organi.sation or theexercise by mother cults of quality controls over franchiser cults or economies of scale orscope. Slandard explanations stress battles over supremacy and cultic imperialism or mere"friendly connections" between sites worshipping the same diety." Silver, EconomicStrucntres. p.33.

49. Ibid., p. 10.50. Ibid., p.8.51. n Kings 9-10 recounts the Israelite coup and the slaughter of the Melkar! hierarchy in

Samaria: chapter 11 records a parallel revolt against Queen Athaiah in Judah led by thetemple priest Jehoiuda restoring both Ihe Davidic line and the traditional Hebrew worship. IKings 18 relates the story of the confrontation between Elijah and the state-supporied priestswho undoubtedly supervised T^Han business activity in norihem Israel. C'armel may wellhave been the site ofajoint Isruclite-Tyrian shrine to Melkan. Stem. 'New Evidence', p.32.tn the commercial context of this presence. Elijah's taunt that Baal WSK 'on a journey' (IKings 18:27) takes on new significance.

52. One of Pritchard's Assyriiin texts records Ashumasirpal 11 (883-59 BCt receiving 'tribute ofthe seacoast from the inhabitants of Tyre, Sidon, Byhlos' in the form of gold, silver, dn,copper, copper container*, linen garments with multicolored trimmings, large and smallmonkeys, ebony, boxwtxxl, [andl ivorv from walnis tusk.' Pritchard. Ancient Texts.pp.276-8!.

53. Moscali. The World of the Phoenicians. pp.!8-2l; see as well the Esarhaddon texts inPritchard, Ancient Texls pp.290-91.

54. Treaty of Bsartiaddon wiih Baal of Tyre. Pritchard. Ancient Texts, p.5.34.55. Ibid.. P..5.W.56. E. Lipinski. 'Les Ph^niciens fl Ninivii au temps des Sargonide: Ahonbasti, Portier en chef,

Atti del I Congresso lntemazionale di Sludi fenici e punici. Roma. 5-10 Novembre 1979(Rome, 198.1). Vol.1, pp.125-34.

57. A.L. Oppenheim, 'Essay in Overland Trade in the First Millennium BC. Journal ofCuneiform Studies. Vol.21 (1967). p.253.

58. Oppenlieini. 'Essay in Overland Trade', pp.239—40. Most nf the iron for the Assyrian annycame from mines in the region of Aram-Damascus. Syrian mines supplied the armies of theAssyrian king Adad-Nirari 111 (810-783 BC) with I4.(XX) kilograms of iron ore. Oppenheim.'Essay in Overland Trade", pp.239. 241. 246-7. From !0()0 BC on 'the Wesi was the majorsource of the iron used by the Assyrian war machine'. Oppenheim, 'Essay in OverlandTrade'. p.24l.

59. In 1940 manufacturing accounted for 59 per cent. fo(Kl 12 per cent and textiles 17 per centof the Japanese economy. Abe and Fitzgerald. Jafanese Economic Suci-ess. pp, 1-2.

60. Ibid.. PP..3-1. 7-8.61. Aubet. Phoenicians and the West, p.4.^; Moscati. The World of the Phoenicians, p.98.

Phoenician metal-working shops in Cyprus 'communicated directly with a nearby temple'whose walls were covered with graffiti of ships. Silver. Economic Structures, p. 19.

62. One .should also keep in mind that the Princes of Tyre knew how vulnerable ihey were toAssyrian economic pressure in terms of food. Witness ihe record of Esarhaddon's attack onTyre: 'I withheld from them |i.e. ihe inhabitants of besieged Tyre] food and [fresh] waterwhich sustains life.' Pritchard,/\H(IWJ/ Texts, p.292.

6.1. Moscati. The World of the Phoenicians, p. 99.

ANCIENT PHOENICIA 41

64. Aubel, Phoenicians and the West, p.234.65. Diodorus Sictdus, Vol..^4:35. English translation by C.H. Oldfathcr (Cambridge. MA, 1939).66. A. Blanco-Prcijeiro und J.M. Luzon. Tre-Roman Silver Miners at Riollnto". Antiquity,

67. R.J. Harrison. Spain at the Dawn of History: Iberians, Phoenicians and Greeks (I_ondon.1988), pp.l5O-3l: A. Blanco-Frtrijciro and B. Rolhenberg. Exploracion Arqueometaltirgicade Huelva (FAH) (Barcelona. 198!). pp.y6-8. 101. l()4-6. 113-14. According to Aubet. 'weare dealing with an advanced technology and a we 11-organised mining enterprise. It is nol bychance ihat ail [his activity in Rio Tinto began at ihe same time as the first (races of aPhoenician presence appear in the region." .Aubel. Phoenicians and the We.^t. p.238.

68. Aubet. Phoenicians anil the West, p.24O: Blanco-Freijeiro and Rolhenberg. ExplaracidnArquenmetaliirgica df Hui'lva, pp.104—6. 113-14; Harrison, Spain at ttie Dawn of History,PP.I52-.3.

69. Aubet, Phoenicians and the West, pp.240-41.70. Oldfalher. Diodorus Siculus, Vo!.35:2-5.71. Aubet. Phoenicians ami the West. p.2(X).72. Harden. The Phoenicians, p.63.73. Aubet. Phoenicians and the West., p.202.74. Moscati. The World of the Phoenicians, p.99: Harrison. Spain at the Dawn of History,

pp.42-3: F. Barreca, 'The Phoenician and Punic Civilization in Sardinia'. Miriam S. Balmulh(cd.). .Studies In Sardinian Archaeology, Volume II, Sardinia in the Mediterranean (AnnArbor. Ml. 1989). pp.152-3: F.M. Cross. "Phoenicians in Sardinia; The EpigraphicalEvidence', in Miriam S. Balmuth and Robert J. Rowland (eds.). Studies In SardinianArchaeology {Ann Arbor. MI. 1987). pp.,*i?)-6.

75. Aubel. Phoenicians and the West, p.203; 'In this case, the founding of ihe colony led lo aneed lo bring the coast and the coaslal valley.s swiftly under its sway, thai is, to establisheconomic and territorial autonomy in relation to the interior and ti> guaranlee peacefulexploitation of Ihe agrieullura! land and metal deposiis' (p.2O7).

76. Ibid., pp.203-7; Barreca. 'Phoenicians and Punic", pp.152-4.77. M.C.F. Caslro./frcnV;/>( Pre/imwv (Oxford. 1995). pp.177. 183^.78. Y. Tsirkin. 'Economy of the Phoenician Settlement.^ in Spain", Edward Lipinski (ed.). State

and Temple Economy in the Ancient Near Ea.it, pp.548-51. 563.79. Tsirkin, 'Economy of the Phoenician Seitlemenis". p.557; Castro. Iberia in Prehistory.

pp. i82^. 191-2; Harrison. Spain at the Dawn of History, pp.43-4.80. Among the Iberian towns near the Guadalquivir, the graves of Carmona showed a healthy

market for the luxuries prtxluced by these subsidiaries and those in Gades. Tyrian craftsmen-importers skilled in finishing ivt)ry created 'a provincial Phoenician workshop' withinseventh-centu!7 BC Cannona itself. Harrison. Spain at the Dawn of History, pp.64-5. Bothhere and at El Carainbolo near Seville. Phoenician technology in gold- and ivory-working.as well as jewellery-making was transferred lo native Iberian workshops, whose artisansbecame as adept as iheir tuiors. An elaborate necklace found near Seville, however, 'maywell have come fnim Gudir itself". Harrison. Spain at the Dawn of History, p.dfi. The clearestexample of transnational technology transfer, however, took place in the explosive growth ofthe Iberian pottery industry, which instead of a household skill, became a mas^-produetiontrade after 6.'S0 BC. All over southern Spain workshops arose turning oul large quantities ofthe popular grey and red Tyrian stylishly jugs decorated wilh bands of red. black and maroonpainl. Harrison. Spain at the Dawn of History. p.(>8.

81. M. Gras, P. Rouillard and J. Teixidor. "The Phoenicians and Death", Berytus, ArchaelogicalStudies, Vol.XXXIX(l99lKp.l45.

82. Tsirkin. 'Economy of the Phoenician Settlements", p.557.83. Gras. Rouillard and Teixidor. "Phoenieians and Death", p.145.84. Barreca. 'Phoenicians and Punic', p.l52.85. Tsirkin. 'Economy of the Phoenician Settlements', p.559; Kilion also directed Ibero-

Phoenician exports lo the Aegean, although dlrecl trade between Spain and Greece also

4 2 BUSINESS HISTORY

existed. Greek vessels and Cyprioi anifacts were found in both Malta and in Iberian andIbero-Ph(K;nici;m lomhs heforc 7()0 BC. Ibid., pp.55^3-60.

86. Isaiah 2.1:1.87. T.J. GamiU>. Sociul Complexity in Southwest Iberia: 800-^00 BC: The Case of Tanessos,

B.A.R. lnternaiional Series 43') (Oxford. I98S). p.54 (emphasis added).88. Harrison. Spiiifi at the Dawn of History, p.42 (e in p ha.*; is added).89. C.J. McMillan, The Japanese Industrial System (New York. rev. edn. 19%). pp.56-7.