of citizenship to numerous individual inhabitants of
the neighbouring villages (_Pfalburger_, a term not satisfactorily
explained). By this and other means, e.g. the purchase of estates by
citizens, many towns gradually acquired a considerable territory. These
tendencies both princes and lesser nobles naturally tried to thwart, and
the mediate towns or _Landstadte_ were finally brought to stricter
subjection, at least in the greater principalities such as Austria and
Brandenburg. Besides, the less favourably situated towns suffered
through the concentration of trade in the hands of their more fortunate
sisters. But the economic decay and consequent loss of political
influence among both imperial and territorial towns must be chiefly
ascribed to inner causes.

Certain leading political economists, notably K. Bucher (_Die
Bevolkerung von Frankfurt a. M. im 14ten und 15ten Jahrhundert_, i.,
Tubingen, 1886; _Die Entstehung der Volkswirtschaft_, 5th ed., Tubingen,
1906), and, in a modified form, W. Sombart (_Der moderne Kapitalismus_,
2 vols., Leipzig, 1902), have propounded the doctrine of one gradual
progression from an agricultural state to modern capitalistic
conditions. This theory, however, is nothing less than an outrage on
history. As a matter of fact, as far as modern Europe is concerned,
there has twice been a progression, separated by a period of
retrogression, and it is to the latter that Bucher's picture of the
agricultural and strictly protectionist town (the _geschlossene
Stadtwirtschaft_) of the 14th and 15th centuries belongs, while
Sombart's notion of an entire absence of a spirit of capitalistic
enterprise before the middle of the 15th century in Europe north of the
Alps, or the 14th century in Italy, is absolutely fantastic.[9] The
period of the rise of cities till well on in the 13th century was
naturally a period of expansion and of a considerable amount of freedom
of trade. It was only afterwards that a protectionist spirit gained the
upper hand, and each town made it its policy to restrict as far as
possible the trade of strangers. In this revolution the rise of the
lower strata of the population to power played an important part.

The craft-gilds had remained subordinate to the _Rat_, but by-and-by
they claimed a share in the government of the towns. Originally any
inhabitant holding a certain measure of land, freehold or subject to the
mere nominal ground-rent above-mentioned, was a full citizen
i