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Guilds are groups of self-employed skilled craftsmen with ownership and control over the materials and tools required to produce their goods. Historically they were small business associations, since each crafter was a self-employed individual artisan or part of a small craft shop or co-operative. They exist in modern and medieval incarnations, both of which are discussed in this article. One's view of guilds tends to be heavily colored by one's view of political economy, since the whole history of trade, technology, intellectual property, regulated professions, and professional ethics are entwined with the history of the guilds in Europe.

Table of contents
1 Early history
2 European history
3 Organization
4 Fall of the Guilds
5 Influence of guilds
6 Modern guilds
7 Sources

Early history

Regulated professions were a feature of the ancient and classical world. The Code of Hammurabi specified a death penalty for builders, or masons, whose buildings fell on the inhabitants. Hammurabi himself had been a stonemason, so this could be considered an early example of self-regulation. The Hippocratic Oath applies to this day as the basis of the modern physicians' ethical code. All known legal codes include some limits on the practices or powers of jurists, e.g. the Rules of Civil Procedure, or politicians, e.g. the rules of parliamentary debate. It has generally been recognized that those in a position of special knowledge or trust were to be held accountable to the public for their advice and services.

Islamic civilization extended this to a degree to the artisan as well - most notably to the warraqeen, "those who work with paper". Early Muslimss were heavily engaged in translating and absorbing all ilm ("knowledge") from all other known civilizations, "as far as China." Critically analyzing, accepting, rejecting, improving and codifying knowledge from other cultures became a key activity, and a knowledge industry as presently understood began to evolve. By the beginning of the 9th century, paper had become the standard medium of written communication, and most warraqeen were engaged in paper-making, book-selling, and taking the dictation of authors, to whom they were obligated to pay royalties on works, and who had final discretion on the contents. As the standard means of presentation of a new work was its public dictation in the mosque or madrassah, in front of many scholars and students, a high degree of professional respect was required to ensure that other warraqeen did not simply make and sell copies, or that authors did not lose faith in the warraqeen or this system of publication. This was an early guild.

This publication industry that spanned the Muslim empire from the first works under this system in 874 to the 15th century, gave rise to all concerns a modern intellectual property lawyer would recognize: by means of the tens of thousands of books per year so published, instructional capital from one group of artisans admired for their work could be spread to other artisans elsewhere who could copy it and perhaps "pass it off" as the original, exploiting the social capital built up at great expense by the originators of techniques. Artisans began to take various ways to protect their proprietary interests, restrict access to techniques, materials, and to markets.

European history

By the Middle Ages (circa 1100) European guilds (or gilds) and livery companies had evolved into an approximate equivalent to modern-day business organisations such as institutes or consortiums. They had strong controls over instructional capital, and the modern concepts of a lifetime progression of apprentice to craftsman, journeyer, and eventually to widely-recognized master and grandmaster began to emerge. The appearance of the european guilds are believed to be tied to the emergent money economy, and the urbanization. Before this time it was not possible to run a money-driven organization, as commodity money was the normal way of doing business.

The guild was at the center of European handicraft organization. The guild system appeared in Germany in the Middle Ages, circa 1300. The guilds are identified with organizations enjoying certain privileges (letters patent), usually issued by the king or state and overseen by local town business authorities (some kind of chamber of commerce). These were the precedecessors of the modern patent and trademark system.

Like their Muslim predecessors, European guilds imposed long periods of apprenticeship, and made it difficult or impossible for those lacking the approval of their peers to gain access to materials or knowledge, or sell into certain markets. These are defining characteristics of mercantilism in economics, which dominated most European thinking about political economy until the rise of classical economics. States applied this thinking, for instance, to restrict the flow of gold and silver to military opponents, as gold was useful to buy weapons and hire mercenaries.


The guild was made up by experienced and confirmed experts in their field of handicraft. They were called master craftsmen. Before a new employee could rise to the level of mastery, they had to go through a schooling period during which they were first called apprenticess. After this period thay could rise to the level of journeymen. An apprentice would typically not learn more than the most basic techniques until they were trusted by their peers to keep the guild's or company's secrets.

The name journeyman comes from the fact that after being employed by a master for several years, and after producing a qualifying piece of work, the journeyman was given a letter which entitled him to travel to other towns and countries to learn the art from other masters. These journeys could span large parts of Europe and was an inofficial way of communicating new methods and techniques.

After this journey and several years of experience, a journeyman could be elected to become a master craftsman. This would require the approval of all masters of a guild, a donation of money and other goods, and in many practical handicrafts the production of a so-called masterpiece, that would illustrate the abilities of the aspiring master craftsman.

The medieval guild was offered a letters patent (usually from the king) and held an oligopoly on its trade in the town in which it operated: handicraft workers were forbidden by law to run any business if they were not members of a guild, and only masters were allowed to be members of a guild. Before these privileges were legislated, these groups of handicraft workers were simply called "handicraft associations".

The town authorities were represented on the guild meetings and thus had a means of controlling the handicraft activities. This was important since towns very often depended on a good reputation for export of a narrow range of products, on which not only the guild's, but the town's, reputation depended. Controls on the association of physical locations to well-known exported products, e.g. wine from the Champagne and Bordeaux regions of France, fine China from certain cities in Holland, lace from Chantilly, etc., helped to establish a town's place in global commerce - this led to modern trademarks.

Fall of the Guilds

Despite its advantages for agricultural and artisan producers, the guild became a target of much criticism towards the end of the 1700s and the beginning of the 1800s. They were believed to oppose free trade and hinder technological innovation, technology transfer and business development. According to several accounts of this time, guilds became increasingly involved in simple territorial struggles against each other and against free practioners of their arts, but the neutrality of these claims is doubted. It may be propaganda.

Two of the most outspoken critics of the guild system were Jean-Jacques Rousseau and Adam Smith, and all over Europe a tendency to oppose government control over trades in favour of laissez-faire free market systems was growing rapidly and making its way into the political and legal system. From this time comes the low regard in which some people hold the guilds to this day. For example, Smith writes in The Wealth of Nations (Book I, Chapter X, paragraph 72):

It is to prevent this reduction of price, and consequently of wages and profit, by restraining that free competition which would most certainly occasion it, that all corporations, and the greater part of corporation laws, have been established. (...) and when any particular class of artificers or traders thought proper to act as a corporation without a charter, such adulterine guilds, as they were called, were not always disfranchised upon that account, but obliged to fine annually to the king for permission to exercise their usurped privileges.

In part due to their own inability to control unruly corporate behavior, the tide turned against the guilds.

Because of industrialization and modernization of the trade and industry, and the rise of powerful nation-states that could directly issue patent and copyright protections, often revealing the trade secrets, the guilds power faded. After the French Revolution they fell in most European nations through the 1800s, as the guild system was disbanded and replaced by free trade laws. By that time, a large portions of the former handicraft workers had already been converted to workers of the manufacturing industry, using not closely held techniques but standardized methods controlled by corporations.

This was not uniformly viewed as a public good: Karl Marx criticized the alienation of the worker from the products of work that this created, and the exploitation possible since materials and hours of work were closely controlled by the owners of the new, large scale means of production.

Influence of guilds

Guilds are sometimes said to be the precursors of modern trade unions, and also, paradoxically, of some aspects of the modern corporation. Guilds, however, were groups of self-employed skilled craftsmen with ownership and control over the materials and tools they needed to produce their goods: they were small business associations, in other words, had very little in common with unions. However the journeymen organizations, which were at the time illegal, may have been influential.

The privileges of the guilds to produce certain goods or services have similarities in its spirit and character with the original patent systems that surfaced in England in 1624. These systems played a role in ending the guilds' dominance, as trade secret methods were superseded by modern firms directly revealing their techniques, and counting on the state to enforce their legal monopoly.

Some guild traditions still remain in a few handicrafts, in Europe especially among shoemakers and barbers. Some of the ritual traditions of the guilds were conserved in order organizations such as the Freemasons. These are however not economically very important except as reminders of the responsibilities of some trades towards the public.

Modern antitrust law could be said to be derived in some ways from the original statutes by which the guilds were abolished in Europe, but they are of a much more recent character.

Modern guilds

Modern guilds tend to exist in fields where, like the medieval warraqeen, a very strong and rigid system of intellectual property respect exists in one industry: the Screen Actors Guild and Writers Guild of America, for instance, are capable of exercising very strong control in Hollywood, and excluding other actors and writers who do not abide by the strict rules for competing within the film and television industry in America. A lack of meaningful global competition may be part of the reason why guilds can persist in this industry.

Thomas Malone of the Massachusetts Institute of Technology champions a modern variant of the guild structure for modern "e-lancers", professionals who do mostly telework for multiple employers. Insurance including any professional liability, intellectual capital protections, an ethical code perhaps enforced by peer pressure and software, and other benefits of a strong association of producers of knowledge, benefit from economies of scale, and may prevent cut-throat competition that leads to inferior services undercutting prices. And, as with historical guilds, resist foreign competition.

The free software community has from time to time explored a guild-like structure to unite against competition from Microsoft, e.g. Advogato assigns journeyer and master ranks to those committing to work only or mostly on free software. Debian also publishes a list of what constitutes free software - apparently the GFDL used by Wikipedia does not qualify, so all authors who contribute here may well be subject someday to guild pressures.

In the City of London, the ancient guilds survive as Livery Companies, most of which play a ceremonial role.


Gilding is the act of applying a thin layer of usually gold over another surface.