The primary economic system in medieval Europe was feudalism. This hierarchical structure was characterized by the relationship between lords, vassals, and serfs. Lords owned large estates and granted land (fiefs) to vassals in exchange for military service and loyalty. Serfs worked the land and were bound to it, providing agricultural labor in return for protection and sustenance. Feudalism created a decentralized political system, where local lords held significant power over their lands and subjects. This system dominated Europe during the Middle Ages and influenced social structures, economics, and political relations.