Ancient China’s Economy – Ancient China Trade and Early Farming

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Chinese man planting rice in a rice paddy: Ancient China trade

Ancient China trade: Rice paddy with a Chinese man planting rice

Farming in Ancient China

In China, as in West Asia, India, or Africa, most people have spent most of their time farming for the last ten thousand years.

Probably eight or nine out of every ten people who lived in ancient China spent most of their time out in the fields, planting seeds, weeding, and then harvesting and processing grain. That was a hard way to live! Even children spent most of their time working in the fields. Most kids didn’t even have time to go to school.

(Read more about schools in ancient China)

Most Chinese farmers didn’t own their own land. They worked as sharecroppers or as tenants (renters) on a richer family’s land. So they didn’t even get to keep all the food they had worked so hard to grow! They had to give some of it to the family that owned the land. In northern China, people mostly farm wheat, while in southern China it is mostly rice.

(Read more about the history of rice)

A video of people picking rice
A cowrie shell: Ancient China trade

Ancient China trade: A cowrie shell

Ancient China Trade: the Silk Road

But when the great empires formed, about 500 BC, people in China also began to trade a lot with other people all across Asia, along the Silk Road.

Some of the traders went south to India, and some went along the northern Silk Road through Uzbekistan to the Persian Empire. China shipped silk, tea, and porcelain west to Central Asia, and imported horses, gold, silver, wool carpets, glass, and steel.

(Read more about the history of tea)

Chinese silk cloth and the Silk Road

In order to have something to sell on the Silk Road, Chinese traders encouraged manufacturers to make more and more fancy silk cloth. Chinese silk cloth sold for a lot of money in other countries!

(Read more about the history of silk)

But that beautiful cloth took a lot of work to make. Children and old people spent long days picking mulberry leaves and feeding them to silkworms. Women spent hours and hours soaking and unwinding the cocoons, and then spinning the silk into thread and dyeing it. Women spent days sitting alone at looms, weaving the thread into fancy silk cloth. Still more women used tiny needles to embroider dragons and flowers on to the silk.

Most of these people were very poorly paid for their work, but the cloth made traders a lot of money.

Circular metal coin with a square hole in the middle and Chinese writing on it - Ancient China trade

Ancient China trade: Han Dynasty coin of the Empress Kuo

Cowrie shells and money in China

People first used cowrie shells for money in China as early as 1800 BC, under the Shang Dynasty. People used cowrie shells for money all across Asia, and in Africa too. Cowrie shells were rare enough to be valuable, and small enough to carry conveniently.

The invention of cash money

But later, when it was hard to get enough cowrie shells, people in China switched to using metal imitations of cowrie shells, and then metal strings of beads called cash. That’s where our word “cash” comes from.

Chinese paper money: Ancient China trade

Ancient China trade: Chinese paper money

Chinese bronze coins

We don’t know whether the idea to make coins with writing on them guaranteed by the government came from West Asia or not. But there were definitely bronze coins in China by the 400s BC in the Zhou Dynasty.

(Read more about the history of money)

Mining and steel in ancient China

Another important industry in China was mining. In the Han Dynasty, people in China began running businesses digging deep pits to get salt to sell. Most of the men who worked in the mines were probably slaves.

(Read more about the history of salt)

Around the same time, Chinese silk workers developed steel sewing needles so they could sell fancy embroidered silk cloth. Then Chinese traders began to sell a new Chinese invention, paper, on the Silk Road too.

(Read more about the history of paper)

Medieval China – glass and cotton

As the Silk Road continued to bring imports to China, gradually people in China began to make some of these things for themselves. By the 400s AD, Chinese manufacturers were blowing their own glass.

(Read more about the history of glass)

About 1200 AD, with the encouragement of Kublai Khan, they were growing their own cotton, and spinning thread much faster on the new spinning wheels.

China prints the first paper money

As more and more people bought and sold things in ancient China, people needed more and more coins. Bronze wasn’t worth enough, and gold was worth too much, to be convenient for coins. People really wanted silver coins. But there was not enough silver in China.

China traded lots of silk cloth to West Asia and Europe, in exchange for silver to make coins.  But there was still never enough silver.

By about 1100 AD, under the Song Dynasty, there was such a shortage of silver for coins that people in China started to use the world’s first paper money.

For a second source to cite, check out this excellent article using primary sources from the University of Indiana

Did you find out what you wanted to know about ancient China trade? Let us know in the comments!

Learn by doing: Chinese money
More about the Silk Road

Bibliography and further reading about the ancient Chinese economy:

Craft project: make your own Chinese coins
The Silk Road
More about Ancient China home

By |2018-06-13T16:50:34+00:00June 6th, 2017|China, Economy|8 Comments
Cite this page: Carr, K.E. Ancient China’s Economy – Ancient China Trade and Early Farming. Study Guides, June 6, 2017. Web. December 10, 2018.

About the Author:

Dr. Karen Carr is Associate Professor Emerita, Department of History, Portland State University. She holds a doctorate in Classical Art and Archaeology from the University of Michigan. Follow her on Instagram, Pinterest, or Facebook, or buy her book, Vandals to Visigoths.


  1. john doe August 1, 2018 at 3:49 am - Reply

    wat type of economy was china

    • Karen Carr August 8, 2018 at 6:58 am

      I’m not sure what you mean by the question; what are your choices?

    • anomous November 5, 2018 at 9:49 am

      its wot

  2. sry cant say my name June 13, 2018 at 2:13 pm - Reply

    love this

  3. shaelee May 17, 2018 at 8:25 am - Reply

    what did they trade

    • Karen Carr May 17, 2018 at 9:00 am

      From the article: “China shipped silk, tea, and porcelain west to Central Asia, and imported horses, gold, silver, wool carpets, glass, and steel.” If you click on any of those words in the article, you can find out more about the trade.

  4. Sophie May 11, 2018 at 6:18 am - Reply

    Wonderful website. It helped me get a good grade on my project. Thank you so much.

    • Karen Carr May 11, 2018 at 9:57 am

      You’re welcome, Sophie! I’m glad we could help. Thanks for letting us know. If your teacher would like to link to the articles that helped you, so next years’ students could use this site too, we’d be delighted.

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