At Charles the Great's deposition, the regnum Italiae, whose capital was Pavia, included north Italy from Piedmont to Friuli, Emilia as far as Modena, Tuscany, the Marches and the Abruzzi. The tumultuous immediate post-Carolingian period was dominated by the rivalry between Berengar and Wido, who were both typical products of a political transformation which had its roots in the hierarchical social order of the Frankish empire. Otto's reign immediately distinguished itself by the interest shown in Rome and in central and south Italy. In 967, Otto I raised his son to the position of co-emperor and began negotiations to obtain the hand of the Byzantine princess Theophanu for him. Despite the dealings between the two courts, there remained a certain amount of tension between them because of the renewed royal and imperial interest shown by Otto I in south Italy. The regional power structure in Italy just before the millennium shows the balance achieved between stability and innovation.

The beginnings of the European town in the form known to us from the late Middle Ages lie in the tenth century. The trading of Islamic merchants was shaped by a detailed legislative framework based on writing. In the regions outside the old Roman Empire incorporated into the Frankish empire during the Merovingian and Carolingian periods, people find very varying beginnings for quasi-urban settlements and for mercantile centres. Markets for wholesale and long-distance trade, merchants' inns, and also markets for the agrarian produce of the hinterland lay on the periphery. In the transalpine regions of the former Frankish empire, in what were becoming France and Ottonian Germany, the development of towns took a quite different path. Although the development of towns and markets in France, Lotharingia and Germany was strongly influenced by regional political forces, the Ottonian rulers played a decisive part.

A sensitivity to grain crises and the rapid and dynamic reactions may be responsible for the apparently somewhat chaotic and uneven growth. Such a characteristic of early medieval demographic evolution is probably partly responsible for the fact that these fluctuations cannot be determined or delimited chronologically. The prevalence of pigs in comparison to sheep and especially to cattle, on both desmesne land and farms held in tenure, points to mixed farming in which the stock economy was subordinate to an agricultural economy centred on grain production. From about the middle of the eighth century onwards, the structure and exploitation of land ownership in the Frankish empire between Loire and Rhine, between Rhine, Elbe and Alps, and in northern and central Italy underwent profound changes. As a result of the dominant role of manorial organisation in agrarian and industrial production, the exchange of goods and trade were also to a large extent dependent on the large estate and its production.