In the history of economic thought, ancient economic thought refers to the ideas from people before the Middle Ages.

Economics in the classical age is defined in the modern analysis as a factor of ethics and politics, only becoming an object of study as a separate discipline during the 18th century.

Ancient Near East

Economic organization in the earliest civilizations of the Fertile Crescent was driven by the need to efficiently grow crops in river basins. The Euphrates and Nile valleys were homes to earliest examples of codified measurements written in base 60 and Egyptian fractions.

Egyptian keepers of royal granaries, and absentee Egyptian landowners are reported in the Heqanakht papyri. Historians of this period note that the major tool of accounting for agrarian societies, the scales used to measure grain inventory, reflected dual religious and ethical symbolic meanings.

The Erlenmeyer tablets give a picture of Sumerian production in the Euphrates Valley around 2200–2100 BC, and show an understanding of the relationship between grain and labor inputs (valued in "female labor days") and outputs and an emphasis on efficiency. Egyptians measured work output in man-days. The development of sophisticated economic administration continued in the Euphrates and Nile valleys during the Babylonian Empire and Egyptian Empires when trading units spread through the Near East within monetary systems. Egyptian fraction and base 60 monetary units were extended in use and diversity to Greek, early Islamic culture, and medieval cultures. By 1202, Fibonacci's use of zero and Vedic-Islamic numerals, motivated Europeans to apply zero as an exponent, birthing modern decimals 350 years later.

The city-states of Sumer developed a trade and market economy based originally on the commodity money of the Shekel which was a certain weight measure of barley, while the Babylonians and their city-state neighbors later developed the earliest system of economics using a metric of various commodities, that was fixed in a legal code. The early law codes from Sumer could be considered the first (written) economic formula, and had many attributes still in use in the current price system today: codified amounts of money for business deals (interest rates), fines in money for 'wrongdoing', inheritance rules, laws concerning how private property is to be taxed or divided, etc. For a summary of the laws, see Babylonian law.

Earlier collections of (written) laws, just prior to Hammurabi, that could also be considered rules and regulations as to economic law for their cities include the codex of Ur-Nammu, king of Ur (c. 2050 BC), the laws of Eshnunna (c. 1930 BC)Reuven Yaron, The laws of Eshnunna, Brill (1988) and the code of Lipit-Ishtar of Isin (c. 1870 BC).

Ancient Greco-Roman world

Some scholars assert economic thought similar to the modern understanding occurred during the 18th century or the Enlightenment, as early economic thought was based on metaphysical principles which are incommensurate with contemporary dominant economic theories such as neo-classical economics., citing especially and .

Several ancient Greek and Roman thinkers made various economic observations, especially Aristotle and Xenophon. Many other Greek writings show understanding of sophisticated economic concepts. For instance, a form of Gresham's law is presented in Aristophanes’ Frogs, and beyond Plato's application of sophisticated mathematical advances influenced by the Pythagoreans is his appreciation of fiat money in his Laws (742a–b) and in the pseudo-Platonic dialogue, Eryxias. Bryson of Heraclea was a neo-platonic who is cited as having heavily influenced early Muslim economic scholarship.

Hesiod

In the opinion of the Austrian school of economics the first economist is thought to be Hesiod, by the fact of his having written on the fundamental subject of the scarcity of resources, in Works and Days. His contribution to economic thought is at least in his relevancy to the practice of economical activity in the depositing and lending of grain, as his writings are "... the chief resource for details as to Grecian agriculture ..." and that according to Loudon (1825) he provided " ... directions for the whole business of family economy in the country".

Xenophon

The influence of Babylonian and Persian thought on Greek administrative economics is present in the work of Greek historian Xenophon. Discussion of economic principles are especially present in his Oeconomicus, Cyropaedia, Hiero, and Ways and Means. Hiero is a minor work which includes discussion of leaders stimulating private production and technology through various means including public recognition and prizes. Ways and Means is a short treatise on economic development, and showed an understanding of the importance of taking advantage of economies of scale and advocated laws promoting foreign merchants. The Oeconomicus discusses the administration of agricultural land. In the work, subjective personal value of goods is analyzed and compared with exchange value. Xenophon uses the example of a horse, which may be of no use to a person who does not know how to handle it, but still has exchange value.Oeconomicus I. 5-6, 8.

Although this broadens the idea of value based in individual use to a more general social concept of value that comes through exchange, scholars note that this is not a market theory of value. In Cyropaedia Xenophon presents what in hindsight can be seen as the foundation for a theory of fair exchange in the market. In one anecdote, the young Cyrus is to judge the fairness of an exchange made between a tall and a short boy. The tall boy forces the pair to exchange tunics, because the tall boy's tunic is too short, shorter than the short boys, which is too tall for him. Cyrus rules the exchange fair because it results in a better fit for both boys. Cyrus' mentors were not pleased with Cyrus' basing his decision on the values involved, as a just exchange must be voluntary.Cyropaedia, I.3.15–17.

Later in the biography, Xenophon discusses the concept of division of labor, referencing specialized cooks and workers in a shoemaking shop.Cyropaedia, VIII.2.5–6 Scholars have noted that Adam Smith's early notes about this concept "read like a paraphrase of Xenophon's discussion of the role of the carpenter as a "jack of all trades" in small cities and as a specialist in large cities. Marx attributes to Cyropaedia the idea that the division of labor correlates to the size of a market. Xenophon also presents an example of mutual advantage from exchange in a story about Cyrus coordinating an exchange of surplus farmland from Armenians, who were herders, and surplus grazing land from Chaldeans, who were farmers.Cyropaedia III. 2. 17–33.

Plato

Of Plato's works those considered the most important to study of economics are Nomoi, Politeia and Politikos (Backhaus). In his work Laws Plato writes on the three things as important to a person: mind he stated as the most important, then body, and lastly estate (Χρήματα). In Phaedo, Plato makes the first distinction between things which are thought necessary and those thought a luxury (Bonar).JE Alvey - Plato's Republic as one of the foundations of the ethical tradition of economics Massey University 2011 Retrieved 2012-07-08(secondary) S. C. Woodhouse – English-Greek Dictionary A Vocabulary Of The Attic Language (1910) G Routledge and Sons Retrieved 2012-07-08

Plato promoted the exercise of temperance in respect to the pursuit of material wealth such that by strengthening moderation a person there-by preserves the order of their psyche. In The Republic he gives an account of the manner by which a state is to be formed with the skills (techne) of individuals supporting economic sustainability. With respect to the identification of skill Plato's writing in the Republic also deals with the specialization of skills as the concept of division of labour.

Aristotle

Aristotle's Politics (ca. 350 BCE) was mainly concerned to analyze different forms of a state (monarchy, aristocracy, constitutional government, tyranny, oligarchy, democracy) as a critique of Plato's advocacy of a ruling class of philosopher-kings. In particular for economists, Plato had drawn a blueprint of society on the basis of common ownership of resources. Aristotle viewed this model as an oligarchical anathema. In Politics, Book II, Part V, he argued that:

Allocation of scarce resources was a moral issue to Aristotle. He also wrote in Politics (book I), that consumption was the objective of production, and the surplus should be allocated to the rearing of children, and personal satiation ought to be the natural limit of consumption. (To Aristotle, the question was a moral one: in his era child mortality was high). In transactions, Aristotle used the labels of "natural" and "unnatural". Natural transactions were related to the satisfaction of needs and yielded wealth that was limited in quantity by the purpose it served. Un-natural transactions aimed at monetary gain and the wealth they yielded was potentially without limits. He explained the un-natural wealth had no limits because it became an end in itself rather than a means to another end—satisfaction of needs. This distinction is the basis for Aristotle's moral rejection of usury.

Later, in book VII Chapter 1 of Politics, Aristotle asserts and some interpret this as capturing a concept of diminishing marginal utility, though there has been marked disagreement about the development and role of marginal utility considerations in Aristotle's value theory. Certainly this book formulates an ordinal hierarchy of values, which later appeared in Maslow's contribution to motivation theory.

Aristotle's Nicomachean Ethics, particularly book V.v, has been called the most economically provocative analytic writing in ancient Greece. Therein, Aristotle discusses justice in distribution and exchange. Still considering isolated exchanges rather than markets, Aristotle sought to discuss just exchange prices between individuals with different subjective values for their goods. Aristotle suggested three different proportions to analyze distributive, corrective, and reciprocal or exchange transactions: the arithmetic, the geometric, and the harmonic. The harmonic proportion implies a strong commitment to the subjective values of the traders.

Sixth century AD philosopher Boethius used the example of 16 as the harmonic mean of 10 and 40. Sixteen is the same percentage larger than 10 as it is smaller than 40 (60 percent of 10 is 6, while 60 percent of 40 is 24). Thus if two bargainers have subjective prices for a good of 10 and 40, Aristotle points out that in exchange, it is most fair to price the good at 16, due to the equality proportional differences from their price to the new price. Another nuance in this analysis of exchange is that Aristotle also saw a zone of consumer surplus or mutual advantage to both consumers that had to be divided.

Roman law

Early Greek and Judaic law follow a voluntaristic principle of just exchange; a party was only held to an agreement after the point of sale. Roman law developed the contract recognizing that planning and commitments over time are necessary for efficient production and trade. The large body of law was unified as the Corpus Juris Civilis in the 530s by Justinian who was emperor of the Eastern Roman Empire from 526 to 565.

Ancient India

Chanakya