The Real Reason Hammurabi Wrote His Code (It Wasn't Justice)

Four thousand years ago, someone wrote the first financial rulebook — and we’ve been following it ever since.
Before banks, before markets, before the idea of “the economy,” the ancient world faced a problem that still haunts us today: how do you control debt, risk, and collapse without tearing society apart? In this episode, The Financial Historian looks beyond the famous “eye for an eye” myth to uncover the real purpose of the Code of Hammurabi — a system designed not for justice, but for financial stability. This is the story of how the earliest civilization learned to manage debt, contracts, inequality, and power… and why the same logic still shapes our modern financial system.
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Key Facts & Insights
• The Code of Hammurabi (c. 1754 BCE) is one of the oldest written legal systems — and most of it focuses on loans, wages, contracts, and debt, not crime or morality.
• Punishments were class-based, with different consequences for elites, commoners, and slaves — a clear system of financial risk containment.
• Debt limits and temporary debt relief were early tools to prevent economic collapse, not acts of mercy.
• Builders, merchants, and surgeons faced strict liability rules — an early form of risk management and moral hazard control.
• Human life was not treated equally under the law; systemic disruption was priced higher than individual loss.
• The code prioritized predictability over fairness, a principle that still governs modern markets and policy.
• From ancient Babylon to modern bailouts, the financial system has always been designed to protect stability first.
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Further Reading
• Law Collections from Mesopotamia and Asia Minor. Martha T. Roth — A definitive translation and analysis of Hammurabi’s laws, placing contracts, debt, and liability at the center of early civilization.

• The Babylonian Laws. G. R. Driver, John C. Miles — A classic scholarly breakdown of the Code, with deep insight into how class, punishment, and economic risk were structured.

• King Hammurabi of Babylon. Marc Van De Mieroop— A concise and readable portrait of Hammurabi as a political and economic system-builder, not just a lawgiver.
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The Real Reason Hammurabi Wrote His Code (It Wasn't Justice)#themoneyrelics