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In most medieval countries, the government was a monarchy. By contrast, guilds were governed by their members, rather democratically. So guilds were not the same as most governments.

There were places, however, where the guilds actually took over towns and cities, installing governments of their own. This was usually done by groups of guilds, and the resulting governments were republican in form, sometimes approaching democracy. Such towns and cities were mostly within monarchies, subject to a king or emperor, and were called free cities or communes. Sometimes, however, they were entirely independent republics.

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