Ingolifs said:
Uhh, if it's an expansive topic, then I wouldn't know where to begin.
Okay, perhaps just tell me examples of what mediaeval guilds did that were often bad for trade and bad for earning money.
Well, you asked for it....
There were three sorts of guilds in operation within a city: professional guilds (lawyers, doctors, bankers), merchant guilds (venturers, drapers, grocers) and crafts guilds (weavers, smiths, bakers). They all regulated their profession/trade/craft according to some strict rules. They determined whom could (and could not) engage in that activity, the quality standards they had to adhere to and often the prices that could be charged.
Within a guild, there were ladders of rank. First, the "apprentice" (usually a seven year stint as the near-slave of some master of your craft), then the "journeyman" (in theory a one-year stint, where you work for wages on jobs contracted by a master, although you could switch masters) then, finally, the "master" (when you finally become a full member of a guild and can ply your trade on your own account). Unfortunately, it often happened that masters kept a tight lid on who could ascend to their ranks, so journeymen were frequently shut out for years on end and forced to continue scraping a living as wage-laborers for someone else.
The most pernicious aspect of guild were that members agreed not to compete with each other. In other words, if you negotiate with carpenter Tom to build to build you a table, carpenter Harry cannot jump in and offer to do it for a lower price. No bidding wars were allowed, so prices tended to be artificially high.
Merchant guilds were particularly pernicious since they had a legal hold on the buying & selling of stuff. A blacksmith could not sell so much as a nail to a customer out of his blacksmithy. He had to sell it to a member of the ironmonger's guild and the ironmonger would sell it to the public. Again, non-competition rules were the rule: if ironmonger Tom was negotiating to buy a bag of nails from smith Joe, then ironmonger Harry could
not leap in and offer a higher price for them.
Moreover, merchant guilds often held both ends of the stick: they sold the raw materials and bought the output from the craftsmen. e.g. If a blacksmith wanted to make horseshoes, he had to buy the iron bars from an ironmonger and sell the resulting horseshoes to an ironmonger. You can guess the result: the ironmonger sold the raw iron bars for a hefty price and paid little for the resulting horseshoes.
In short, craftsmen couldn't buy raw materials from the cheapest source nor sell their goods to the highest bidder.
It is for this reason that merchant and crafts guilds were often at odds with each other -- and often violently at odds, with frequent tumults in the streets.
The members of merchant guilds were usually richer & had higher social standing than the craftsmen. For some types of merchants, like long-distance merchants, wool-merchants, etc., they were wealthy & high-status enough to ally with and marry into the nobility (in some cases, e.g. in Italy, the members of the merchant guilds were very often nobles themselves). Thus the frequent stories of urban gangs formed by craftsmen battling it out on the city streets with bands of noble retainers hired by the merchants guilds.
That said, merchant guilds had obligations too. For instance, they were legally obliged to buy their goods from city craftsmen; they were not allowed to buy goods from "abroad", from other cities or even from workshops in the countryside. (the writ of guilds reached usually up to the city walls, in some cases three miles beyond that, but rarely more). Conversely, they were not allowed to sell "abroad" either. Goods must be sold "in town".
So, like craftsmen, merchants too faced the problem of not being able to buy from the cheapest source & sell to the highest bidder. (Of course, since the great merchant guildsmen were very often the "powers-that-be", it was easier for them to bend the rules and get away with it.)
So why sanction guilds? Well, their origin is deep in history. When a city got "incorporated" by royal charter, guilds were often legally recognized along with them. Indeed, the "definition" of a city requried it. To
live in a chartered city as a free man, you
must show proof of guild membership; otherwise you're assumed to be the runaway serf of some feudal lord and have no right to be there.
(Even in London today, an incorporated city, very few people have the "legal" right to be there; only those who have acquired the "freedom of the city" (membership in one of the London's guilds, what they call "livery companies") are legally sanctioned. All other Londoners are technically vagabonds & squatters and (up until very recently) had no role or voice in city government.
)
Secondly, everyone in the Middle Ages was on the verge of starvation. Nothing panicked rulers more than a shortage of some good or another, which might lead to riots in the streets and mutinies in the army. The guildsmen "persuaded" rulers that the way to "ensure" there were no shortages was to "protect" their trades and crafts from "destructive competition".
Of course, that was a lie. Competition is what makes the world go around. But in Medieval times, there was very little understanding of that.
To take an example, suppose there was a really bad harvest in the environs of London and a really good one in the environs of Bristol. In a free market world, the price of grain would rise in London and the price of grain fall in Bristol, which would prompt merchants (in their self-seeking profit ways) to buy grain in Bristol and sell it in London. High London grain prices might also induce East Anglian turnip farmers to plant grain for next year. The shortage of grain in London would be automatically "fixed" by market forces.
But under guild rules not only was shipping grain from one area to another explicitly forbidden, the prices were not allowed to fluctuate either, so no signals were sent out to induce any activity on the part of merchants and farmers. Londoners might pay low prices for bread, but there would be no bread to buy. She would be stuck with the shortage and the people would starve. At the same time, Bristol's silos would be bursting but the Bristolers would still be paying an unfair price for it. And in East Anglia, turnip farmers would still grow turnips and that's the end of that.
Similarly with the crafts guilds. Not only did they keep things artificially expensive by preventing people from engaging in the trade, their very explicit rules on how to produce stuff kept these crafts in the stone age. Guild rules that "required" to use a particular tool or instrument or method of production and "required" to produce cloth with so many threads per square inch, stifled a lot of technical innovation & quality improvements. Productivity growth was absolutely zilch for many centuries.
It was this type of economic insanity -- non-competition, anti-innovation, unreflective prices, prohibition of commercial traffic -- that kept Medieval economies tied up knots under persistent shortages and on the brink of starvation at all times.
But there was very little understanding of economics back then. And when the rulers were told by some selfish guild masters that "allowing x would ruin us. And if we are ruined, imagine the shortages that will result!", they believed them. e.g. price ceilings & the prohibition of grain traffic was instituted out of fear that free markets would lead to grain being exported and "cause" famines. Whereas the truth is that, under free prices & free markets, precisely the opposite would occur: grain would be transported from bumper regions
to starving regions; it is what
fixes shortages & fends off famines. But the rulers didn't realize that and, of course, the guildmasters did not enlighten them but rather encouraged their misconceptions.
There were two bright spots in the Medieval world: fairs & abbeys.
Fairs were the seeds of the capitalism since guild rules were suspended during fair periods and
anyone could buy & sell whatever they wanted to the public at whatever price they could negotiate. So at fairs, blacksmiths sold nails, journeyman could sell their services, bankers charged whatever interest rates they wanted, foreign merchants could come and sell their wares, etc. Even if everything could not be done within that short amount of time, contracts could be written up then under fair rules, and carried out during the remainder of the year. So, yeh, journeymen carpenters could just come to the fair and just collect contracts to build a hundred shelves, which they would then build in the course of the year and technically not be "in violation" of guild rules.
As time progressed, more and more economic activity became concentrated at fairs, and soon very little large-scale business was ever contracted outside of them. Fairs became increasingly less about "fun & games" and more & more about "serious business", esp. financing. Capitalism proper "begins" when Bruges instituted a "permanent" year-round fair (the "Bourse"), in the early 15th C. (followed up a century or so later by Antwerp & still later, London ("Royal Exchange")),
Heck, by the 16th C., the entire finances & budgets of the greatest monarchs were scheduled around fairs -- the French monarchy depended completely on the Lyons fair, the Spanish monarchy in its Golden Age lived & died by a circuit of three fairs (Antwerp, Piacenza and Medina-del-Campo). But that is a bit beyond our time period.
In the High Middle Ages, outside of fairs, the only other "free market" islands were the Abbeys. Medieval Abbeys were incorporated without guild structures, so abbey markets were free-for-alls. People could buy, sell, truck & barter, contract and be contracted at Abbeys, without any stifling rules (save perhaps canonical ones about usury & stuff). Abbeys were focal points of economic activity, one reason they were so very often envied & targeted by towns & rulers.
). I just need the actual episcopal investiture ceremony/process. This is a really urgent priority.