Hammurabi himself was the successor of a line of rulers who had very methodically fashioned an empire out of a diverse & sometimes turbulent area. His grandfather had actually been responsible for the establishment of the Babylonian empire as such, however, Hammurabi did enhance his empire's prestige & importance among the states of the Near East. His rule extended from the Mediterranean coast, up along the Fertile Crescent, including some of modern Armenia, down through modern Iraq & Kuwait and into southern Iran.
This empire hadn't been built easily, & it was surrounded by enemies. The Assyrians in the north had been integrated into Babylonia, & were cooperative, however, this hadn't always been the case, & in fact this would change, later on. To the east were the last of the Elamites & Aryans who would eventually establish their own empire of Persia. To the northwest were the formidable Hittites, and the enigmatic Hurrians (whom Hammurabi defeated in battle). To the west were the Amorites & Amalekites, whom Babylonia had appeased, but they weren't the most stable allies to have.
Now, Babylonia itself had been built from prior empires, particularly those of Sumer and Akkad. Babylonian culture was a blend of Sumerian and Semitic influences. Ethnic Sumerians remained in the south, Semites in the north (the Assyrians among them), & the region had attracted other ethnic groups as well. The city of Babylon itself was immense & quite cosmopolitan; walking down any given street, you might hear a dozen different languages being spoken. It was a commercial hub as well as a political center & military power.
Hammurabi, therefore, ruled a large, diverse population, and if he was to retain control of them, & stave off their enemies, he needed — above all — to build stability, at home. Although he was a competent leader, an excellent administrator, & even a good general, none of this would help, if his own people & power-base fragmented underneath him. This had been the downfall of prior empires (such as that of Sargon of Akkad), and Hammurabi and his predecessors had been careful not to make the same mistakes).
Prior to the establishment of single, concrete law code, the various ethnic groups within Babylonia governed themselves according to their own customs. This was a problem, however, when they interacted. For example, did a contract between a Sumerian and an Assyrian have to observe Sumerian or Assyrian custom? Previously this would have been a matter of debate — and likely might have caused no small amount of strife.
What Hammurabi did, for which he is noted, and which helped him promote the stability he so desperately needed, was to boil down all the collective customs & quasi-laws of the many ethnic groups, into a single legal code, which all would observe uniformly. This reduced the potential for strife, and in fact, it helped to promote commerce, since the outcome of transactions was more certain.
Hammurabi included within his code aspects of many different legal traditions. Apparently he did not wish to appear to favor any single ethnic group. Even so, Hammurabi's Code was heavily influenced by Sumerian law, since the Sumerians had a long-standing legal tradition, & since writing was their invention, what law codes existed, had been in the hands of Sumerian scribes.
Although Babylonia was eventually overwhelmed by the Assyrians, who later on "went independent," as it were, Hammurabi's Code had a lasting impact on all the cultures which subsequently came into contact with Mesopotamia. His Code influenced the Assyrians, & the Persians. Mosaic law, as observed in the Old Testament, shows his Code's influence. The Greeks were taken by the Code, when Alexander conquered Persia, exposing them to Babylonian custom. In turn, the Code influenced Roman law, & all the legal customs which followed, down through the Middle Ages, until today.
The importance of this cannot be overstated. The Code of Hammurabi sparked commerce, even in his own time, and ever after, made commercial transactions all the more attractive. His Code also provided a means of making decisions based on fair, objective criteria. Where once, monarchs or patriarchs or clan-chiefs had to make all legal decisions, occupying their time with useless minutiae, such things could be turned over to others (typically, scribes) who would make those decisions, based on the Code. In a very real way, we owe to Hammurabi the notion of a separate judiciary, as part of overall government — and this is a hallmark of modern democratic governments, the world over.
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