technology that does not require their specialized input. The theory predicts an inverted-U relation between guilds and market …, specialized workers have no reason to form guilds; for intermediate sized markets, firm profits are large enough to cover the … higher fixed costs, but not large enough to defeat workers' resistance, and so workers form guilds and block adoption; and …

evidence by means of a stylized model describing two engines determining this economic process: the role of the guilds in the … countryside in order to escape from the guilds' market power in urban environments. In the countryside entrepreneurs …