The Minoan culture on the island of Crete in the Aegean Sea flourished from about 3000 to 1100 B.C. In what is known as the Palace Period (ca. 2000-1450 B.C.), power was centralized in palaces and, later, in villas. According to one authority, the five primary economic functions of Minoan palaces during much of the Palace era were (1) production of manufactured goods, (2) consumption of food and manufactured goods, (3) regulation of local and internal exchange, (4) regulation of international and external exchange, and (5) use as depositories (storage facilities).
The production and storage of manufactured goods are evident from the archaeological digs at Phaistos and Mallia, important place sites. Excavations of the earliest phases at Phaistos (those from the so-called First Palace Period, which ended about 1700 B.C. ) revealed two areas dedicated to economic activity. Unit A contained several large storage vessels originally filled with foodstuffs, including liquids such as wine and oil. Nearby Unit B was the palace workshop. Here, excavators found tools used for stone working (a lapidary workshop), several loom weights (a weaving workshop), and two potter’s wheels (a ceramics workshop). Clay sealings from a smaller room in Unit B may indicate where finished products were processed for storage or export. By the Second Palace Period (roughly 1700-1450 B.C.), there were even more food storage vessels present and an archive room (a room for storing documents).
Similar finds appeared at Mallia. In the northwest quarter of the palace, excavators discovered obsidian, soapstone, and a reddish marble called rosso antico, all evidently part of the lapidary (stonecutting) workshop. A potter’s workshop was also present within the palace walls. During part of this period, the workshop of a bronze smithy was located just outside the palace walls. It is actually surprising that such an industry would be so close to any residential quarters, considering the unpleasant fumes given off by the work and the rather high potential for fires. Nevertheless, at a somewhat later date, the palace walls were extended so that the smithy was located within the palace itself. Clearly, this was an industry over which the palace wanted to keep very close control.
The role of Minoan palaces as depositories and regulators of local distribution and trade may be seen in the koulouras --- large, stone-lined pits located at Knossos, Phaistos, and in a slightly altered guise, at Mallia. There is continued debate as to the purpose of these huge storage bins. It was originally suggested that they were rubbish pits. Some modern scholars believe that they were grain tree planters. But the usual interpretation is that they were for grain storage, with the koulouras at Knossos being able to hold enough grain to feed 1,000 people and the koulouras at Phaistos being able to hold enough for 300 people. In such a case, the palace would have received a substantial portion of the agricultural produce of the surrounding farms, stored it, and then distributed it to the more specialized, nonagricultural populace of the palace region.
Palatial control over foreign trade is more difficult to prove archaeologically, as there is often no way to determine where on Crete any specific item found abroad was made. One argument often brought to the fore is that only the palaces would have the capital (to use a modern term) to finance the goods and shipping for long trade journeys, not to mention to handle the risks of possible sea wrecks. Another argument, however, lies in the nature of the Minoan goods found abroad. For example, Kamares ware pottery from Minoan Crete has come to light on the coasts of Cyprus and in areas of the Near East such as Egypt and Syria.This Kamares ware is clearly a product of palatial manufacture. The ceramics from before and after the classical Kamares wares are clearly local creations --- Knossian ware being distinct from Mallian ware. By contrast, the Kamares ware made in the palaces in similar from palace to palace but is utterly distinct from the provincial wares. The number of foreign goods stored in the palaces especially Zakro, also gives evidence for the palatial control of international exchange.