THE Domestic System is no simple and homogeneous form, sharply separated from the new system of the nineteenth century by well-defined features. It had as many varieties within itself as has the ever-changing industrialism of the modern world; and some of its later features are, in fact, nearer to early examples of factory industry than they are to the earlier types of domestic production itself. To a general view it can be divided into two main phases. In the first phase the craftsman still retained much of his former independence. He often bought his own material himself, and arranged the sale of his product, maybe, in the local market, and he retained free ownership of the tools with which he worked. Both in the purchase of rnaterial and in selling his product he was at a disadvantage, since his opportunities for sale and purchase were less than those of the merchant undertaker. He had to content himself with dealing in the narrow limits of a local market or else with a few large undertakers, who were in every way his masters in the bargain. But in spite of this, his power of purchase, though limited, was fairly free. It was the exception for the merchant undertaker to furnish the craftsman directly with his materials and to pay him merely a commissionwage, as was so common in the eighteenth century. Still rarer was it for the undertaker to own the craftsman's tools, as some clothiers owned the weavers' looms. The merchant undertaker found more to gain from exploiting

his wide opportunities for new markets, than he gained out of the depressed status of the craftsnlan.