The fall of Rome was really the fall of tax revenue:
As [Chris Wickham] tells it, the most important dividing line between “ancient” and “medieval” — the profoundest marker of the “fall of Rome” was not a matter of language or culture, of the shift from togas to tunics or from stuffed swan to roast meat. The most important dividing line was the loss of the power and capacity to tax.
The Roman emperors had imposed a wide variety of taxes on trade and land. The revenues from these taxes supported the army and provided the free grain ration to the populations of Rome and Constantinople.
After the breakup of the empire, the successor states tried to maintain the old Roman taxes. Some — like the Merovingian Franks — succeeded for a time. But sooner or later, all these tax systems broke down. The world had become too poor, trade and agriculture too unproductive, to yield a positive return on the effort invested in tax collection.
Instead, rulers began assigning lands to their supporters — on the understanding that the supporters and their tenants would follow the ruler to war when summoned. Land assignment was much less efficient than taxation, and the opportunity it presented for treachery was obvious, but as the world narrowed, what other choice was there?
Curiously, the state that maintained the old Roman tax system longest was not the eastern empire — its tax system broke down in the 610-650 period — but the Islamic caliphate! In the 700s and 800s, the Abbasid caliph was the richest ruler west of China, richer than the Constantinople emperor, vastly richer than Charlemagne. And the foundation of his wealth was the revenue he extracted from Egypt, Syria, and Mesopotamia using the old cadastral surveys of the Roman emperors.
Thomas Hobbes mockingly described the papacy as the “ghost of the deceased Roman empire, sitting throned on the grave thereof.” If Wickham is right, that title more properly belongs to the caliphate — in fiscal terms anyway.
(Hat tip to Razib.)