Capitalism arises and develops historically amidst a non-capitalist soci-

ety. In Western Europe it is found at first in a feudal environment from

which it in fact sprang-the system of bondage in rural areas and the

guild system in the towns-and later, after having swallowed up the

feudal system, it exists mainly in an environment of peasants and

artisans, that is to say in a system of simple commodity production

both in agriculture and trade. European capitalism is further sur-

rounded by vast territories of non-European civilisation ranging over

all levels of development, from the primitive communist hordes of

nomad herdsmen, hunters and gatherers to commodity production by

peasants and artisans. This is the setting for the accumulation of capital.