Ok, so I might not be either a Lord of the Rings nerd or an economist but I was recently wondering- how does the economy of the elves work? You never seem to see any businesses except for maybe a market, or any farms, so apart from making weaponry, where does the money come from? Obviously they appear to have a high standard of living- fancy clothes, beautiful buildings etc, yet none of the industry that might be expected to support it. As it is (I think) reasonably isolated, it probably wouldn't trade much with the outside world either. Do the elves even live in a capitalist society? Is it a feudal system with peasants paying taxes to nobles, in which case where are the peasants? Or is it some other type of society altogether?
Tolkien dI’d not include a description of economics in his works—not the main series works or the supplemental notes and collections that provide insights into his thought process. Such a discussion was unnecessary and irrelevant to the underlying nature of what he was trying to create.
Both LotR and the Hobbit are in-universe writings - the Hobbit is ostensively written by Bilbo and LotR by Frodo. As objects that exist within the world of Arda, there is no need to explain the basic workings of the world - it would be weird for someone to write an entire aside in their autobiography explaining the basic nature of currency. The Silmarillion likewise exists as a mythological work - just like Hesiod didn’t provide a detailed description of Greek economics in the Theogony, it would have been out of place in the Silmarillion.
Now, there clearly is some kind of economic system - Bilbo laments leaving his house without any money, there’s various mentions of coins, etc. There exist silver pennies, which are discussed in Bree, and Bilbo notes he spent “fifty ducats” on his birthday party. There are references to the dwarves having coins. None of those references refer to the elves, though that does not mean they lack coinage—the other references merely had cause to exist within the narrative framing.
So, what does that mean for the elves? There is exactly zero useful information. They could utilise a similar financial system to the humans, dwarves, and hobbits, or they could be a completely barter based economy, or they could simply not have a system of exchange and objects and goods are given based not on mutual consideration but some other factor. Any of those or none of them might be the case—there really is no way to derive the right answer from the scant information available.
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Ok, so I might not be either a Lord of the Rings nerd or an economist but I was recently wondering- how does the economy of the elves work? You never seem to see any businesses except for maybe a market, or any farms, so apart from making weaponry, where does the money come from? Obviously they appear to have a high standard of living- fancy clothes, beautiful buildings etc, yet none of the industry that might be expected to support it. As it is (I think) reasonably isolated, it probably wouldn't trade much with the outside world either. Do the elves even live in a capitalist society? Is it a feudal system with peasants paying taxes to nobles, in which case where are the peasants? Or is it some other type of society altogether?
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Tolkien dI’d not include a description of economics in his works—not the main series works or the supplemental notes and collections that provide insights into his thought process. Such a discussion was unnecessary and irrelevant to the underlying nature of what he was trying to create.
Both LotR and the Hobbit are in-universe writings - the Hobbit is ostensively written by Bilbo and LotR by Frodo. As objects that exist within the world of Arda, there is no need to explain the basic workings of the world - it would be weird for someone to write an entire aside in their autobiography explaining the basic nature of currency. The Silmarillion likewise exists as a mythological work - just like Hesiod didn’t provide a detailed description of Greek economics in the Theogony, it would have been out of place in the Silmarillion.
Now, there clearly is some kind of economic system - Bilbo laments leaving his house without any money, there’s various mentions of coins, etc. There exist silver pennies, which are discussed in Bree, and Bilbo notes he spent “fifty ducats” on his birthday party. There are references to the dwarves having coins. None of those references refer to the elves, though that does not mean they lack coinage—the other references merely had cause to exist within the narrative framing.
So, what does that mean for the elves? There is exactly zero useful information. They could utilise a similar financial system to the humans, dwarves, and hobbits, or they could be a completely barter based economy, or they could simply not have a system of exchange and objects and goods are given based not on mutual consideration but some other factor. Any of those or none of them might be the case—there really is no way to derive the right answer from the scant information available.