The physical topography of the Mediterranean area is most likely responsible for the development of Greek city-states. The environment is characterized by rugged, steep terrain and a large number of islands. As a result of these physical obstacles, population centers were geographically separated from one another. The sea was often the most convenient mode of transportation from one location to another.
Answer: Fractional reserve banking increases the money supply by lending out the money multiple times over -- so doesn't this by nature result in debt (that cannot be paid back) and/or inflation.
