The neo-classical economics paradigm relies on the assumption that most of the behavior in which people engage most of the time is consistent with the production of good outcomes, that is to say, that they behave “rationally.” Techniques that squander resources (at least the scarce ones) will be outperformed by those that conserve them; companies that can make a product cheaper and/or of higher quality will outlast those that cannot; workers with higher skills will be preferred at any given wage over those of lesser capacity regardless of who they otherwise are, and so on. In this framework, institutions that persist—whether they are corporal or processeral—must do so because they (mostly) make sense. Historians, on the other hand, have less faith in such mechanisms. The career of many a fine scholar has been made on the study of people or institutions whose behavior appears to be self-defeating at best or socially disastrous at worst.

What then might we think about the European guilds (craft or mercantile), organizations that persisted for close to a millennium, were widely distributed across a wide spectrum of communities and cultures, and played a prominent role in organizing a multitude of trades and industries? Must something so institutionally successful make economic sense, and if so, for whom and by what metric? Although Adam Smith was no fan of the guilds, seeing them mostly as a way of securing the restriction of trade to the harm of the public, economic historians in the later twentieth and early twenty-first centuries have (somewhat remarkably) rallied to their defense, attributing to them a benevolent logic of training, technological innovation, and control of quality. (See especially S.R. Epstein and Maarten Prak, eds. Guilds, Innovation and the European Economy: 1400–1800. Cambridge: Cambridge University Press, 2008.) Sheilagh Ogilvie, in her monumental new book on The European Guilds, is having none of it.

This is not a new fight for her, having already published widely about guilds as egregious restrictors of trade, and especially memorably in the Economic History Review on the powerful role of distributional conflicts in shaping institutions (60, no. 4 [2007]: 649–84). Now in this book she builds her case in a tour de force of data collection, and a systematic analysis that takes the guild system to task for every one of its potential failures, and simultaneously rejects every one of its potential contributions to economic growth and/or consumer wellbeing. Having combed seemingly every published source on a European guild, and consulted a staggering number of archives, her work relies on a final collection of 12,000 observations, from 23 European societies, across the 900 years spanning 995–1899, and emerging from an impressive variety of sources: legal, civic, mercantile, accounting and banking, industrial, visual, and literary to name just the major types. If this data collection had been the extent of her contribution it would be remarkable in itself. But this is simply her starting point.

After a relatively brief introduction of the evidence she has collected and explanation of the methodology which lies behind its organization, the book proceeds for more than another 500 pages to systemically review the economic history literature in support of guild activities, and to take it apart, point by every point. Long after one is convinced that she is right, she is still at it. This is perhaps the most salient critique one might make of the book, that it could have been more compact for the reader not as deeply invested in the fight as she is. That said, the debate is a critical one, on its own merits as well as for what it might tell us about the underlying assumptions made routinely in economic analysis on a host of other questions.

The heart of the matter is focused on the issue of whether guilds helped to solve problems of market failure for societies that were not yet as fully marketized as ours today (presuming of course that such marketization is itself a solution for various kinds of economic problems, which it often is not). Did guilds contribute to education and training in the (presumed) absence of other channels for the same? Did they help consumers make informed decisions in an environment of less abundant information than would have been available ideally? Did they bring order to what was otherwise a chaotic situation for both producers and consumers? To all of these questions, Ogilvie responds with a resounding no. To that she adds that guilds systematically discriminated against women, Jews, the lowly-born, migrants, and any other group they could successfully define as outsiders and get away with it; they raised prices for the profit mostly of employers; they restricted the range of quality clearly desired by consumers; they stifled technical innovation; and combined forces with state actors to increase their power at the expense of the public weal.

The evidence is overwhelming, and Ogilvie’s argument persuasive. The growth of the European economy over the long medieval and early modern eras appears not to have been helped, and was almost certainly retarded, by the monopoly rents extracted by the guild system to a greater or lesser degree depending on their political power in different locations. This book is essential reading for economic historians, both for its argument, and for the wealth of archival evidence that it contains. From the sixteenth-century German guilds that claimed “that all knitting was beyond the capacity of females to learn (p. 291),” to the eighteenth-century Augsburgers who had to “take a walk in the country” to buy shoes of the quality and price that they actually desired (p. 339), Ogilvie takes us time and again to the heart of the matter, to the historical evidence. Her conclusion, that guilds “existed because they benefited powerful and well-organized interest groups” (p. 581) seems to this reviewer irrefutable.