ABSTRACT
The manorial system, surrounded by small farms, formed the economic core around which the social regime of feudalism was established. Evidently, the strictest form of the system predominated in France and West Germany. The system was unique in Europe and indeed in the world. The Germanic tribes seem to have invaded the Roman lands every generation. The Germanic invasion and the institutional changes thereby wrought forced a redistribution of income to labor and away from the aristocracy. Agricultural techniques in the middle ages did not give much opportunity for direct capitalization. In turn, institutional arrangements were not conducive to the development of capital intensive technologies. In England in the late middle ages, there was a large reserve of cheap agricultural labor descended from the younger sons of serfs. The economic organization of towns in Flanders centered around the guilds.
