One of many possible factors was the marked population increase in the south Aegean during the Early Bronze Age. This led to the development of some extensive settlements, although the overall settlement pattern continued to be dispersed, with a majority of small hamlets and farmsteads. This could have caused a degree of settlement hierarchy at this stage, with some sites acting as regional centres. Central places provide opportunity for craft specialization and redistribution of commodities and thus lead to social hierarchy and a type of society known as the complex chiefdom. Another important factor was the change in agricultural production that followed the adoption of vine and olive cultivation during the 3rd millennium bce and the possible increase in the exploitation of sheep. These were commodity-oriented activities, which furthered exchange and redistribution. These products were more suitable for a redistributive economy than for a household economy. Olives, in particular, demand capital investment, since it takes several years before the crop produces. Within this setting, the palace economy, a complex bureaucratic organization based on a redistributive economy, developed. The first state had appeared in Europe.
This process can be followed from 1800 bce onward in Mycenae, in mainland Greece, and on Crete. The character of the society was distinct at each of these centres, but the palace economy distinguished them from the villages and farmsteads of temperate Europe. For reasons not clearly known but possibly related to subsistence crises and over-exploitation of dwindling metal supplies, these centres collapsed suddenly about 1200 bce, and thereafter Greece entered its Dark Ages. After a few centuries of restructuring, about 800 bce this was followed by a remarkable Greek expansion into the western Mediterranean, during which colonies were founded in southern Italy, Mediterranean France (Massalia), and along the southeastern coast of Spain. The Etruscan state, which developed in Italy from about 700 bce, competed for domination of the western Mediterranean, and during the Early Iron Age Etruscan as well as Greek influences reached beyond their Mediterranean neighbours.
During the Iron Age, stratification became common and marked throughout Europe. Differences in wealth and status in terms of both individuals and households were reflected in graves as well as settlements. Settlements reveal internal division of houses according to size and function, and the population of any village was divided by wealth in addition to sex, age, kinship, and personal characteristics. Socially differentiated settlements existed from Scandinavia to Italy and from Ireland to the Russian borders, although they were differently laid out and organized. This period saw the building of permanent fences and enclosures around fields and farms; the development of villages and, within these, increasing differentiation of the sizes of individual buildings; and increased stratification between settlements, with proto-urban centres coming into being. The rate of change varied in different parts of Europe, but toward the end of the 1st millennium bce all areas had undergone these changes. The end of this trend in northern Europe is vividly illustrated by the Hodde village in Denmark, where the community can be followed during the centuries near the end of the 1st millennium, revealing how a few farms within the enclosed village gradually grew bigger at the cost of the others. An unstratified village was replaced by a society divided into rich and poor in only a few centuries. In other parts of temperate Europe, social division was equally clearly present, and proto-urban characteristics such as commerce, administrative centres, and religious offices came into existence on some of these sites. In this process, the defended hilltop settlement of the Early Iron Age was increasingly replaced by more complex sites.
The proto-urban tendencies are particularly strongly suggested by the oppida of western, central, and eastern Europe. These were often densely populated enclosed sites, which housed full-time specialists, such as glassmakers, leather workers, and smiths. Manching, one of the largest oppida in Europe, contained many of these characteristics. The site, located at the junction of the Danube and the Paar rivers, was occupied from about 200 bce and developed rapidly from a small undefended village to a large walled settlement. The defense was an elaborate construction consisting of four-mile-long walls built of timber and stones and including four gateways. Some areas within the defense were never occupied but others (a total of about 500 acres) were densely settled. The organization of the settlement was preplanned, with streets up to 30 feet wide and regular rows of rectangular buildings in front of zones containing pits and working areas; other areas were enclosed for granaries or the stalling of horses. The site was divided into work areas for particular crafts, such as wood, leather, and iron working. Coins were minted and used on the site, and there is evidence of much trade.
A market economy, rather than a redistributive economy, is the hallmark of these sites, and they were important supplements to the regionally dispersed smaller villages and farmsteads. Commodities became direct wealth, and the exchange of different values was monitored through coins. A drastically altered society was the result, but the Roman expansion at the end of the 2nd century bce caused major changes and brought local development to an end. The Romans established their own towns and a new system of government, and the oppida were not given the opportunity of developing on their own into towns, for which they had laid the ground.
The beginning of the Iron Age was in many areas marked by change in burial rites. The extensive use of cremation during the Urnfield Period was replaced by inhumation graves with magnificent displays of wealth. During the Late Hallstatt Period these changes were most dramatically reflected by the group of so-called princely graves in west-central Europe. These were immensely rich burials in large barrows, in which the construction of grave chamber and barrow became monumental enterprises, reminiscent of the late Unetician barrows at Leubingen and Straubing. In each case the grave was a display of power and status, giving emphasis and prestige to an individual or a lineage at a time of overt disruption of the social order. One of these rich Hallstatt graves was Hohmichele, located within the complex around Heuneburg on the Danube. This barrow was one of the satellite graves surrounding the large hill fort. It covered a central grave and 12 secondary burials. The barrow was constructed in several stages, resulting in a large imposing monument on the level land behind the hill fort. The central grave was robbed in antiquity, but it had been an inhumation grave within a wood-lined chamber, which acted as the display area for the wealth of the deceased. The walls seem to have been draped in textiles with thin gold bands, and the deceased, dressed in finery including silk, was placed on a bed next to a four-wheeled wagon. These graves, while commemorating members of the society in a traditional way, also show new elements that had become part of the life of the nobility north of the Alps. The drinking set suggests the adoption and importance of the Greek drinking ceremonies, using the Greek jugs and Schnabelkannen (“beaked pots”) for pouring and serving wine, the kraters for mixing, and the amphorae for storage and transport. The implied wine-drinking ceremony, which was likely restricted to certain sectors of the society, and furniture directly imported from the south show the emulation of southern city life by the central European chiefs.