Eco 223 Economic History of the Western Community Chapter

Eco 223 Economic History of the Western Community: Chapter
3 – Feudalism
TOWNS IN THE FEUDAL PERIOD - the analysis of urban
life in the feudal period is crucial to understand the long period
of transition from feudalism to capitalism
TOWNS IN THE EARLY PERIOD (8th - 11th centuries)
PRECONDITIONS FOR THE REVIVAL OF TOWN LIFE
DEVELOPMENT OF MARITIME AND INLAND CITIES (12th
– 13th centuries)
CITY REGULATION
THE URBAN ECONOMY
FOOD AND FOOD SALES
URBAN INDUSTRY
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3 – Feudalism
TOWNS IN THE FEUDAL PERIOD
TOWNS IN THE EARLY PERIOD (8th - 11th centuries) – the
urban centers of the Roma Empire were practically empty
during these period due to a large extent to the Moslem
invasions during the 7th and 8th centuries. At the beginning of
feudalism, towns became less important as centers of economic
life, and their populations fell as European countries turned
increasingly to an inward looking, self-sufficient agricultural
life style.
Functions of towns during this period
Towns as ecclesiastical centers
Towns as military centers.
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3 – Feudalism
Towns as Ecclesiastical Centers

As the Roma Empire disappeared, the Christian Church
survived in the old Roman cities. The fact that feudal princess
moved back to their country estates meant that the Church’s
authority and power in cities increased without any physical
presence to provide a counter-influence. Cities were populated
by clerics, monks, teachers and students of the Church-run
schools, household servants and artisans. Market activity in
these towns was limited to the local markets where peasants
from the surrounding areas sold agricultural produce to the town
dwellers.
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3 – Feudalism
Towns as Military Centers
Roman cities were always fortified against invaders and
during the insecurities of the feudal period they served as
secure refuges of the neighborhood population. In addition, as
feudal nobles were now in charge of defending and protecting

their land and population, a new military element to the old
town was now added.Burgs – were strategically located
fortresses built with the purpose of serving as military bases.
Over time burgs became administrative centers as the nobles’
agents acquired more authority over the area. Military and
ecclesiastical cities became the locations were the expansion of
trade and commerce, and thus the expansion of towns, was
located.
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3 – Feudalism
PRECONDITIONS FOR THE REVIVAL OF TOWN LIFE – two
conditions are crucial for towns to become permanent
establishments:
There must be a need for a town
There must be a surplus food supply in the countryside

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3 – Feudalism
establishments:
There must be a need for a town – there must be some economic
function or functions requiring the cooperation of many
individuals and the ability to tap support services: activities that
can be accomplished only when there is a large enough pool of
population in a concentrated area.
There must be a surplus food supply in the countryside

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3 – Feudalism
establishments:
There must be a need for a town – there must be some economic
function or functions requiring the cooperation of many
individuals and the ability to tap support services: activities that
can be accomplished only when there is a large enough pool of
population in a concentrated area.
There must be a surplus food supply in the countryside – there
must be a way to support an urban population. Townspeople
typically do not provide all their food needs themselves, there
must be a permanent surplus of food and other agricultural
necessities of life. The division of town and country, each with
its won specific functions, is one of the earliest and most
general examples of a division of labor.

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3 – Feudalism
PRECONDITIONS FOR THE REVIVAL OF TOWN LIFE – in
the 11th century the two conditions were met.
A NEED FOR A TOWN: Improving environment for trade and
exchange activities created an economic incentive for people to
move to cities and towns. The prospect of a new life in the city
was helped a general restoration of peace and an increased
feeling of security, as well as by improvements in
transportation.
SURPLUS FOOD SUPPLY IN THE COUNTRY SIDE:
Expansion of agricultural output driven by the extension of
usable agricultural land and some improvements in agricultural
technology. The production of an agricultural surplus became a
permanent possibility.

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3 – Feudalism
The existence of these preconditions (A NEED FOR A TOWN
& SURPLUS
FOOD SUPPLY IN THE COUNTRY SIDE) gave rise to the
revival of two
types of commercially-oriented cities:
Maritime cities
Inland cities
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3 – Feudalism
MARITIME CITIES
DEVELOPMENT OF MARITIME CITIES (12th and 13th
centuries)
During the 11th century, the Western Church began to face up
to the Islamic challenge and for the following two centuries
supported the Crusades, periodic military expeditions sent from
Europe to recapture the Holy Land from the Moslems. The
Crusades aided the revival of those Italian port cities that were
the departure points of the crusading armies through their needs
for provisioning and transportation.
During this period there was a rise in population, which not
only helps explain the extension of land under cultivation but
also helps explain some of the population shifts that occurred.
This was a period of internal colonization of Europe, which in
later centuries would be transformed into external colonization
of previously unknown lands.
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3 – Feudalism
MARITIME CITIES

MAIN MARITIME CITIES
Venice – regarded as the great commercial city of the late
feudal period. Venice was never invaded by barbarians, hence
was never a feudal city, and still maintain trading links with the
East. A characteristic unique to Venice was the lack of any
feudal ethic that held back commercial activity. Gain was
important and Venetians didn’t care where it came from: during
the Crusades they supply both Christian and Moslem armies.
Exports: wheat, wine and salt. Imports: luxury fabrics, muslin,
gauze, and spices.
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3 – Feudalism
MARITIME CITIES: VENICE
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3 – Feudalism

MARITIME CITIES
Flanders – Historically, Flanders was a region overlapping parts
of Belgium, France, and the Netherlands. Today, Flanders often
designates the merged Flemish Region and Flemish Community,
with a parliament and government for the inhabitants of the
northern half of Belgium. Flanders may also refer to the
Flemish Region, which does not include Brussels-
Capital.Regarded as another important commercial city of the
late feudal period. Competed with Venice and had the
advantage of an indigenous cloth industry that could supply
cargoes for the return journey. Exports: cloth. Imports: raw
wool (from England).
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3 – Feudalism
MAIN MARITIME CITIES : Map of Flanders
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3 – Feudalism
MARITIME CITIES
MAIN EFFECTS OF THE REVIVAL OF TRADE
UNDERLYING THE REVIVAL OF MARITIME CITIES
Enormous profits available for risk-taker merchants – Goods for
trade multiplied and increasingly more manufactured European
goods exported to the East . Most goods traded were luxuries –
spices – with a low weight and a high unit value. This implied
huge profits for those merchants willing to take the risks and
hazards of the journeys.
Signs of a new capitalist mentality began to shows in this new
merchant class . The use of the enormous profits to make still
more profits indicated the existence of the idea of capital
accumulation. At first, the capitalist spirit dominated only
exchange activities. Not until the 18th century did the influence
on the production of goods along capitalist lines become
widespread.
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3 – Feudalism
INLAND CITIES

DEVELOPMENT OF INLAND CITIES – also developed as a
result of the emergence of the merchant class, in this case, the
emergence of inland trade. Inland cities were focal points for
merchants and were located on trade routes.
Free status of merchants – inland trading was long distance
trade and involved the movement of traders in large groups for
safety. These merchant-adventurers were always regarded as
foreigners and therefore free because they were not tied to any
land or any master. Previously only nobles were free. This
characteristic of freedom was an important element in the
development of new towns because the merchants’ “freedom”
also applied to the institutions they created.
Merchants settle in pre-existing towns and burgs and these
towns eventually developed into late feudal commercial towns.
The people living inside these new burgs were called burghers
or burgesses. This term was never applied to the inhabitants of
the military burgs, but, in its modern form of bourgeois, is used
to describe those involved in urban, capitalist-oriented
activities.
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3 – Feudalism

CITY REGULATION – towns were the creation of a new group
and its members built up town institutions and organized its
function to meet its needs. Each town developed its own rules,
and the growing strength of towns implied rivalry between
them. This can be seen as a preview of future mercantilist
policies that adopted extreme protectionism in order to further
the national interest.Regulation was needed in order to fulfill
the town requirements. On top of the list of requirements was
the need to guaranteed a sufficient food supply. Food supplies
and food sales were regulated down to the minutest detail.
Urban industry was regulated through the development of craft
guilds. A guild is an association of producers or sellers in the
same trade or activity. Regulation guaranteed a low cost of
living at the expense of the country-side; guaranteed the quality
of products by preventing fraud, abuse, adulteration, and shoddy
workmanship; and protected the inhabitants of towns as much as
possible from competition from outside.
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3 – Feudalism

REGULATION OF FOOD AND FOOD SALES – the most
important task of regulation was to guarantee an adequate food
supply.
Key targets and effects of regulation of food and food
sales: Control of monopoly elements and price risesMaking all
food sales public and eliminating the role of the
middlemanProtection of the town’s own
merchantsStandardization – during this time we see the
beginnings of systems of standardized weights and measures, as
well as quality. The standardization of measures was important
not only for establishing prices, but also for fixing duties on
imports, as import duties were one of the major sources of
revenues for monarchs. The quality of goods, including
prohibitions on adulteration and unsanitary conditions, was also
firmly controlled.
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3 – Feudalism
ENFORCEMENT OF REGULATION OF FOOD AND FOOD

SALES – enforcement of regulation was conducted by relying
primarily on public punishment.A baker found guilty of sel ling
an underweight loaf of bread would be carried on a horse-drawn
sled through the streets with the offending item strapped around
his neckA fishmonger found guilty of selling rotten fish would
be pilloried, while the rotten fish was burnt at the base of the
pilloryRepeat offenders were denied sales space in that town,
effectively eliminating their livelihood.Urban craftsmen’s
production was required to be performed in public view. The
rules and regulations were based on achieving a civic ideal, the
end result limited competition and individual initiative.
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3 – Feudalism
ENFORCEMENT OF REGULATION OF FOOD AND FOOD
SALES

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3 – Feudalism
URBAN INDUSTRY – two types of industrial activity: local
craft guilds and export production.Local craft guilds – produced
strictly for the local market and were combinations of urban
artisans who formed associations on the basis of their particular
line of activity. Members shared resources, travelled together
(for security) and shared profits. The main purpose of guilds
was to protect both producer and consumer.
Hierarchy of guilds:Apprentice – person learning the skills
of a craft or trade.Journeyman – guild member who has
completed an apprenticeship but is not yet a guild
master.Master – journeyman who successfully completed a
“master piece”. This position is an example of the non-
capitalist nature of the guild; masters were proprietors of their
own small workshops and owned the materials, tools, and output
produced.

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3 – Feudalism
Functions of the guild – the guild was much more than just an
institution for organizing production. The regulated both
economic (wages, conditions of work, and specifications of
output) and non-economic matters (the charitable contributions
expected from each member, their civic role, their appropriate
dress, and even their daily behavior).
Differences between the medieval guild and modern business
The purpose of the guild was not first and foremost to make
moneyThe main purpose of the guild was to preserve a certain
orderly way of lifeNo free play of price, no free competition, no
restless probing for advantageThe guilds sought to take the risk
out of enterprises

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3 – Feudalism
URBAN INDUSTRY – two types of industrial activity: local
craft guilds and export production.Export production – workers
in these industries were the first example of capitalist
production. They received raw materials from merchants and
earned wages for producing the finished output. Contrast to
local guilds:Workers were at the mercy of crises such as war
that often affected their economic situation. A loss of markets
affected an increasingly large number of people. Exploitation
and worker protests: export workers gave rise to the first
recorded strike in the French city of Douai in 1245. This type
of social unrest was rarely found in early local guilds, because
the journeymen knew their position as wage-workers was only
temporary.

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4 – End of Feudalism
THE DISSOLUTION OF FEUDALISM – in this chapter we
will review the beginnings of the process of creating a wage
labor force and the refocusing of economic activity away from
maintenance of the status quo and towards profit-making for the
purpose of capital accumulation. The chapter identifies the
century from 1350 – 1450 (14TH and 15th century) as the
period when Feudalism ended due to a combination of:
FaminesWarsPlaguessocial uprisingspolitical struggle between
the old feudal nobility and the new monarchs.
*

THE DISSOLUTION OF FEUDALISM
List of topics to be discussed:
NECESSARY CHANGES
THE GROWTH OF THE MARKET ECONOMY
ECONOMIC RECESSION
THE HUNDRED YEARS WAR (1337-1453)
PLAGUES
COMMUTATION AND ALIENATION OF THE DEMESNE
SOCIAL UNREST AND UPRISINGS & RELIGIOUS
UPHEAVALS
EMERGENCE OF NATION STATES
*

NECESSARY CHANGES – three necessary changes had to take
place for feudalism to end and a new transition period to begin.
Changes in the productive methods
Changes in social relationships
Changes in the value system
*
NECESSARY CHANGES
Changes in the productive methods – the need to generate
agricultural and industrial surpluses. An agricultural surplus
was needed to concentrate people in town and thus increase
industrial production. An industrial surplus allows continued
reinvestment in industry and thus capital accumulation in the
modern sense of the word.

Implications: new productive methods and purposes
(profit motive and deliberate production for a market) were
antithetical to those of feudalism. The spread of monetary
exchange relationships (revival of trade and commerce in
towns) was the most important cause of the decline of
feudalism.
*
NECESSARY CHANGES
Changes in social relationships – the need to create a wage-
based labor force out of independent producers in order to have
available labor in agriculture and industry. Social production
had to change so that serfs became free of their links to the land
and had no other alternative but to become wage laborers. This

process took approximately 2 centuries (14th & 15th).
*
NECESSARY CHANGES
Changes in the value system – the need to change the value
system from one that encouraged tradition and stability toward
one that accepted change. Feudalist value system that justify its
rigid two class system gradually gave way to the capitalist
ethic.

*
THE GROWTH OF THE MARKET ECONOMY – how the
growth and expansion of a market economy undermined the
institution of feudalism and altered the way of life of the rural
population.
Local grain marketsMedieval FairsMercantile Laws
*

THE GROWTH OF THE MARKET ECONOMYLocal grain
markets: The importance of local grain markets was increasing
to the point that the first “public” building to be erected after
the church was the corn exchange. Local grain markets were
still only a very small part of total economic activity but their
development had major effects on serfs. Two effects on serfs:
They introduced serfs to a market economy, although the old
feudal rights and obligations continue to dominate behavior.
Serfs became familiar with a money economy and thus, local
markets were a pre-condition of commutation. Commutation
was the substitution of money payments for a serf’s personal
services which could only happen if serfs had money.
*

THE GROWTH OF THE MARKET ECONOMYMedieval Fairs –
infrequent medieval markets for professional merchants engaged
in long distance trade. Medieval fairs affected serfs less
directly, but it shows the growing weakness of the Feudal
structure to prevent change. Medieval Fairs date back to the
11th century, reaching a peak in the 12th century, and declining
at the end of the 13th century. In these fairs commercial and
exchange activities occupied a privileged position undermining
the social ethic of the time in two key aspects:
All attendees were under the protection of the territorial prince,
therefore, not subject to the prevailing laws of the time, which
were not supportive of new commercial developments.
The prohibition of usury was lifted for the duration of the fair.
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THE GROWTH OF THE MARKET ECONOMY Mercantile
Laws: body of law designed by merchants to regulate trading
and exchange. The new market-oriented economic relationships
were different: they were based on contract, not status; based
on money, not traditionthese new laws could not be absorbed
into the old relationships between lord and serf.
Characteristics of new merchant law:
Contracts binding all parties – in contrast to canon law which
frequently absolved a debtor from repayment.
Institution of credit became more sophisticated and acceptable
to all parties. This gave rise to the bill of exchange, which is
simply a promise to pay a sum of money in a place other than
the one where the debt was originally contracted.
The formation of “Pie-powder court”, medieval law courts
enforcing mercantile law.
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Questions for Group Brainstorm and discussion:
Venice became a highly prosperous city by the late feudal
period. What similarities or differences exist between Venice
and other cities of this period?
What preconditions are necessary for the establishment of
towns?
Why were most merchants in the late feudal period considered
to be free?
Discuss the role played by the new towns of the late medieval
period in the dissolution of feudalism.
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Eco 223 Economic History of the Western Community Chapter

Eco 223 Economic History of the Western Community Chapter

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