Democracy, Sea Power and Institutional Change: An Economic Analysis of the Athenian Naval Law

The present essay attempts to test the validity of the theory of institutional change based on the concept of property rights, in the remote historical setting of Classical Athens. The Naval Law introduced by Themistocles in 483-2 BC, established the institution of trierarchy to produce warships to face the Persian invaders. This reform led to the first attempt to define the costs and benefits of public goods in the field of national defense. Thus, institutional change in Ancient Athens, through an efficient arrangement of property rights and duties, had long-term consequences on economic performance, creating a new growth path and ensuring economic prosperity and social justice for more than 150 years.