This chapter deals with the vast territories east of the Elbe river, including Poland–Lithuania, the Czech lands, Brandenburg–Prussia, and Russia. There are two primary and interlocking themes, first the westernization of these lands, secondly, the origins and development of the ‘second serfdom’ in the agrarian East. Westernization of the agrarian East came largely through the introduction and expansion of the ‘Frankish agrarian system’, which began around 1200 with Western colonization east of the Elbe. Westernization was essentially a repetition of basic agrarian developments that had already taken place in much of north-west Europe in the period 600–1000 AD. One of the most important of these developments was manorialism, and the so-called ‘second serfdom’ in Eastern Europe was thus not a deviation from westernization, but rather an integral part of it.
Industry was the most dynamic sector of the European economy in the early modern period, during which it was characterized by both specialization and diversification. This chapter explores the various industries of early modern Europe, examines their forms of organization, and investigates the causes of their differing regional distribution and growth trajectories. Historical scholarship has mainly focused on the causes of industrial growth, especially with regard to later factory industrialization. Starting with theories of ‘proto-industrialization’ and the ‘industrious revolution’, this chapter examines the preconditions for early modern European industrial growth by analysing their effect on costs. To this end, it investigates the roles played by nature, rural society, and urban society. It finds that natural endowments had considerable effects on a number of early modern European industries, but ultimately the strongest impact was exercised by the comparative costs of sociopolitical institutions.