Since the first seaboard settlements, practical affairs in America have been conducted within two rather different economic and legal forms: the corporation and the free market. Each is of ancient lineage, but on these shores the corporation was first on the scene. Jamestown, Plymouth, Massachusetts, and Providence Plantations were settled by semi-private corporations chartered by the crown to perform private and public economic and political functions. They had their precedent in the chartered corporations of medieval towns and their artisan guilds, outside the domain of territorial lords, which controlled manufacture in the towns and governed them. They were akin to the royal grants of monopoly made between the sixteenth and nineteenth centuries to companies of merchants to conduct trade on foreign soil and seas, to govern an enclave at home or abroad, and to deal with foreign princes. Canada in the eighteenth century was the site of several such companies (the Northwest Company and the Hudson's Bay Company); the famous Dutch and English East India Companies were even more powerful and more prominent examples.

These early corporations, though concerned with trade and settlement, were in fact quasi-states, exercising some of the powers of a sovereign over their territories. The land they held in colonial America had been granted by the King under the least restrictive of feudal tenures.