These rents could therefore tie a member to the guild by making change of residence costly and ensuring solidarity among the guild's members.17
The argument advanced here suggests that the guild’s monopoly rights in its home locality may have been instrumental in advancing trade with other localities. These monopoly rights generated a stream of rents that depended on the support of other members and so served as a bond, allowing members to commit themselves to collective action in response to a ruler's transgressions.18
The Flemish regulations of 1240 illustrate the role of rents in providing the appropriate incentives. A merchant who ignored the ban imposed by the guild on another town was expelled, losing his rent stream:
“If any man of Ypres or Daouai shall go against those decisions [made by the guild] for the common good, regarding fines or anything else, that man shall be excluded from selling, lodging, eating, or depositing his wool or cloth in ships with the rest of the merchants. And if anyone violates this ostracism, he shall be fined 5 shillings.” (Moore 1985, p. 298).
4.1.3 The Evolution of Guild Organizations
The evolution and operation of the institution that governed relations between German merchants, their towns, and the foreign towns with which they traded may provide the best example of the guild's contribution to fostering the growth of trade. Because of the relatively small size of the German towns, to achieve the necessary coordination and enforcement for the reputation mechanism to operate effectively, a means was needed to influence the behavior of merchants from different towns. This led to the rise of an interesting form of guild organization known as the German Hansa.19