Every so often, some business magazine or other notable publication will publish a list of the richest historical figures of all time. Topping the list is usually John D. Rockefeller, the founder of Standard Oil and the first person ever to earn a billion United States dollars. If it’s not Rockefeller, number one is usually somebody with “King” or “Emperor” in front of his name…which doesn’t really seem fair. After all, as Antonie de Saint-Exupéry wrote, “Kings do not own, they reign over. It is a very different matter.”
To me, that raises the question, what is the fairest way to compare the wealth of a Roman emperor to an oil baron to Jeff Bezos? What does such great wealth really mean in an economy so different from the one we have today? And which one of them really is the richest person in history?
Surprisingly, I don’t think it’s someone from the historical lists.
The Conventional Wisdom: John D. Rockefeller and GDP
First off, how does Forbes or Business Insider or anyone calculate the wealth of these historical figures? It’s not just adjusting for inflation. At his peak in 1913 (we’ll see why that year in a minute), John D. Rockefeller’s wealth was estimated at $900 million. Coincidentally, 1913 is the earliest year for which the Bureau of Labor Statistics calculates the Consumer Price Index, which allows us to adjust for inflation directly. The CPI tells us that $1 in 1913 has grown to $26.30 today, and Rockefeller’s $900 million fortune becomes…$23.67 billion.
That doesn’t make sense. Rockefeller is supposed to be at the top of the list, isn’t he. The trick is that we don’t just adjust for inflation. We adjust for GDP. In 1913, the United States’ GDP was $39.5 billion, meaning that Rockefeller controlled a whopping 2.3% of the national economy. Although he made more money in his later years, this was his peak wealth relative to GDP. In 2019 (thus, pre-pandemic), the United States’ GDP was $21.4 trillion. If someone controlled that percentage of the economy today they would have nearly $500 billion, as much as the top three Americans today, Jeff Bezos, Elon Musk, and Bill Gates (at least before his divorce), combined.
The Numbers Don’t Add Up: The Case of Alan Rufus
The problem is, this method of translating past wealth into present dollars has never really smelled right to me. Is it fair to scale wealth with GDP when it returns numbers twenty times the size of the metric we use the rest of the time, which is inflation? Does it make sense when the economy is so different and so much bigger now? And for that matter, the population is bigger, too. A billion dollars means something very different in a small country than a large one.
That’s not really even the whole problem, though. If translating wealth from the industrial revolution to today looks fishy, translating it from the middle ages or even earlier times seems downright ludicrous. Take for example Alan Rufus, the 1st Lord of Richmond and nephew of William the Conqueror. Living in 11th century England, he’s perhaps the oldest example whose wealth can be measured in a currency that still exists today, and he routinely ranks as one of the monetarily richest men of the middle ages (as opposed to land ownership or kingship).
(Actually, this fact alone makes me think these lists might be hopelessly biased. I’d bet good money, pun intended, that there were a dozen people in non-English-speaking countries in medieval Europe who were just as rich, and we just don’t have good records of them. After all, the lists frequently include William the Conqueror himself, but never Charlemagne or Otto the Great. Hmm…)
Anyway, Alan Rufus frequently ranks high on the list, with an estimated $182 billion (130 billion pounds) in today’s money. But how much was this vast fortune in the actual 11th century? 11,000 pounds sterling.
I told you it was ludicrous. How can you get anywhere close to that number? There is no way that 1 pound sterling in the 11th century is worth £12 million today. The answer is GDP. At that time, Rufus’s wealth was estimated at 7% of England’s GDP, and that equals $182 billion today. But that only raises the next question of how the GDP of all of England could be only £150,000, and there are multiple reasons that the numbers are so far off.
First of all, the population has gone up. In 1086, when the Domesday Book was compiled, the population of England was probably less than 2 million (although the book itself doesn’t say). Today, it’s 56 million, about 30 times as much. So, Rufus wasn’t 2,000,000 times richer than his neighbors—more like 70,000 times. That puts his wealth at about $7 billion (or rather £5 billion) relative to the average man or woman on the street today. For comparison, the actual richest non-royal in England today is
vacuum cleaner mogul James Dyson at £16 billion.
(Huh. Turns out that was last year’s list. This year’s list says it’s industrial magnate Len Blavatnik at £23 billion.)
That’s more reasonable, but it still doesn’t explain how 11,000 pounds grew so much. The other piece of the puzzle is that Alan Rufus’s neighbors were much poorer than Jeff Bezos’s, and not just because Bezos (presumably) lives around other super-rich people. For the vast majority of human history upwards of 90% of people were living in what we now call extreme poverty, about $2 per day, and 50 times less than the median income in today’s England. Rufus was 70,000 times richer than those people, bringing his $7 billion down to $140 million (£100 million) in today’s money.
That’s still a lot, implying a silver price of about $1000 per ounce in today’s money when the actual number is more like $28. Now, gold has outperformed silver by quite a bit since we went off the gold standard. For large swaths of human history, gold was worth 10 times more than silver. Today, it’s more like 70 times, but even putting it in terms of gold, this implies a gold price of $10,000 per ounce when the modern number is $1900. This makes me wonder if a lot of the economy of 11th century England couldn’t be calculated monetarily (e.g. subsistence agriculture means less actual buying and selling), but at least it doesn’t imply that taking one pound of silver back to the middle ages would somehow make you a multi-millionaire.
Different Ways of Measuring Wealth: the Case of Marcus Crassus
I want to explore more precisely how we can translate money from pre-industrial times to our modern economy, and I think the best way to do that is by looking at a person and an economy from ancient times that we understand as very well for that period: Marcus Licinius Crassus.
Crassus also frequently makes the list of wealthiest historical figures. You may know him as the guy who put down Spartacus’s rebellion in 71 BC. He was a Roman Senator, a member of the First Triumvirate with Pompey and Julius Caesar, and he also became fabulously wealthy through slave trafficking, silver mining, and especially real estate speculation. He’s also credited with inventing the fire department—or at least creating the first known one—but as you might expect of a real estate mogul with questionable morals, he used it to buy properties that were currently on fire before putting them out and leasing them back to their original owners.
All this earned Crassus an enormous sum of money. Sources differ to some extent, but the most commonly quoted figure is 200 million sesterces (singular sestertius). How much money was 200 million sesterces? This is the key point; there are many ways we can interpret that question, and I think we can learn something by going through each one. Let’s start with the most obvious one:
How much silver was in 200 million sesterces?
We’ll get to gold in a minute. In much of the ancient world, gold was of course highly valued, but wealth was usually measured in silver as a precise monetary unit. Plus, in Crassus’s time, sesterces were made of silver. What is a sestertius? It’s one quarter of a denarius, which famously, as described in the Bible, was a day’s wages for a laborer in the Roman Republic/Empire. At the time, a denarius coin contained 4.5 grams of silver, so 200 million sesterces was about 7.2 million troy ounces of silver. At today’s silver price of $28 per ounce, that is $200 million.
Well, that’s not much at all. Maybe it’s like with Alan Rufus where measuring silver gives usually low results. Let’s try a different metal.
How much gold was 200 million sesterces worth?
Gold is probably the most obvious question for today’s money. It’s the one medium that can be converted to pretty near any currency, anytime, anywhere, and has kept anything like its historic buying power. Rome didn’t have a regular gold issue at the time, but a little bit later under Julius Casear, 100 sesterces equaled one aureus, a gold coin weighing 8 grams. Do the math, and that means gold was 14 times more valuable than silver, and Crassus’s fortune would have been worth about 500,000 troy ounces of gold. At today’s gold price of $1900 per ounce, that is $950 million.
Better, but still not a whole lot—not enough to earn a spot on the all-time list. It seems that gold and silver don’t tell us much, which maybe isn’t surprising. Industrial mining and industrial uses of gold and silver have completely changed our relationship with the metals. But we have other options. A denarius was a day’s wages, after all.
How much labor was 200 million sesterces worth?
Now, we immediately have a problem. Whose labor? A first century BC laborer who was living in what we would now call extreme poverty at $2 a day? In that case, the number is only $100 million. But that’s a poor measure of what a day’s labor means to the economy. Ancient Rome was the largest economy in the world at the time. Shouldn’t we compare it to the largest economy in the world today, the United States? At the federal minimum wage of $7.25 per hour, 50 million days of labor would be worth $2.9 billion. Ah, now we’re getting somewhere. Now we’re in the billions. And if you think that the proposed $15 minimum wage is a better measure of the worth of a day’s labor, we’re up to $6 billion.
But again, this is not how we usually measure the value of money in the past. We usually go by inflation—that is, buying power. This leads to our next version of the question:
What could you buy with 200 million sesterces?
On its face, this is a much harder question. So many of the things we buy and even consider essential today are very different from what you could buy in Ancient Rome. In Ancient Rome, all the money in the world couldn’t buy you a cup of coffee—because it hadn’t been discovered yet.
This is why it’s common to covert to a single staple commodity like wheat when trying to measure buying power. Various sources list the Roman Republic’s total GDP in the neighborhood of 13-21 billion sesterces (so Crassus’s wealth was probably more than 1% of the Republic’s GDP). Based on the price of wheat, you could measure Rome’s GDP in wheat at 30-50 million tons. (Note that this is not the Republic’s wheat production. It’s just a price conversion.) The modern price of wheat is about $6 per bushel, or $220 per metric ton, and by this standard, Crassus’s 200 million sesterces were worth $100 million.
Well, at least we know that our calculation for a day laborer was probably right. Calculating by earning power and calculating by buying power give you the same number by the standards of the time. But lets take another look at that GDP figure. To me, this can be interpreted as another question:
What could you control with 200 million sesterces?
And Crassus gives us the answer. He could control 1% of the largest economy in the world. I say “control,” because what do you actually do with that much money? You can buy a lot of politicians. You can buy a lot of shares in the biggest companies around. You can buy a lot of land to develop or rent out. And Crassus did all three. Here is where the standard of scaling by GDP that everyone seems to use comes in. It tells you how much influence the super-rich have over the world as a whole, whatever that world looks like. Today, 1% of the largest economy in the world is $200 billion, 2000 times as much as the simple buying power estimate!
But I still don’t think this sounds right. It tells you valuable information, but it feels like cheating a little bit as a measure of wealth. Instead I have a different standard: wealth scaled by GDP per capita. To frame this the same way as the other estimates, I would ask the following question:
What could you build with 200 million sesterces?
As Forrest Gump said, at some point, money is just for showing off. Someone at this level is wealthy enough to buy all the luxuries they could ever want and still have plenty to spare. At that point, I contend the only way to gauge that wealth is how many hospitals you can build. Or if you’re Bill Gates, how many charities to eradicate polio and malaria you can build. Or if you’re Elon Musk, how many giant rockets you can build. And to figure that out, you need to scale by population because no matter how rich you are, if you’re living in a country of 50 million people (Ancient Rome), you’re only going to have 15% as many resources to draw on than you do in a country of 330 million.
Alternatively, in a country of 50 million people, you only have 15% as much competition to become super-rich as you do in a country of 330 million. It means that rising that high above your countrymen is a less impressive feat.
By this standard, Crassus was worth $30 billion. And honestly, with today’s global economy, we might want to scale that down some more. The Roman Republic was a larger fraction of the world’s population than the United States, anyway. Scaled to the world GDP per capita, his wealth is lowered to $8 billion—which, hey! That’s pretty close to our estimate in terms of labor in a modern economy! Maybe we’re on to something!
And maybe this makes intuitive sense when you think about it. It’s the “keeping up with the Joneses” version of the question: How much richer was he than the average person at the time? Absolute wealth is nearly meaningless comparing times that are so different. In 2021, if you’re living in the developed world, and you have a roof over your head and food on your table, there’s a solid case to be made that you’re living better than a king did 500 years ago. But relative wealth—that’s something we understand. Don’t we always gauge how extravagantly overpaid CEOs are by how much more money they make than their workers? It actually is a measure we use today. We just don’t think about it as much.
And the Winner Is…
So, with this in mind, who was the richest person ever? And for this, I’m going to exclude monarchs and other heads of state. This avoids quibbling over how much an empire is worth, and it lets us pass by some of the more dubious or hard-to-quantify claims like Augustus Caesar (personal fortune allegedly equal to 20% of the Roman Empire’s GDP), Mansa Musa I (controlled 80% of the world’s gold production and spent it so freely that he single-handedly crashed the economy of Egypt), or King Solomon (some Biblical passages imply he controlled more gold than Fort Knox and more silver than his entire kingdom was plausibly worth).
Leaving those people out, the richest person in terms of GDP per capita…I think it might actually be Jeff Bezos with his $200 billion fortune (depending on how Amazon’s stock is doing that day).
After adjusting for population, we’ve seen how Crassus’s potentially competitive 200 million sesterces is recalculated from $200 billion down to $30 billion or less. Ditto for Alan Rufus. Another name that frequently tops the list, Renaissance banking and mining magnate Jakob Fugger, has his 2 million guilders recalculated from $400 billion in today’s money to $50 billion. Even John D. Rockefeller’s alleged $500 billion pile is recalculated to $150 billion—near the top, but only #4 on today’s list.
In other words, it is entirely plausible that in all of human history, no businessman has ever managed to amass a fortune as large as Jeff Bezos relative to the average person.
(Well, him or Louis Vitton CEO Bernard Arnhault, but that’s a family business, so it’s not clear how they break down.)