The recent debate between Chris Wickham and Shami Ghosh exposes different interpretations of the political economy of Europe, with Wickham arguing for the persistence of the feudal economy up to about 1700, and Ghosh imagining a distinct phase in which economic development was not yet capitalist but was no longer decisively shaped by the demands of lords. This article contributes to the discussion with the story of Flanders, where two contrasting trajectories interlocked. On the one hand, coastal Flanders saw the rise of agrarian capitalism from the fourteenth century onwards, when small-scale farms were amalgamated into large agricultural enterprises that relied on the wage-labour of dispossessed peasants and their descendants as well as temporary labour migration from nearby regions. Inland Flanders, by contrast, saw the persistence of a peasant society dominated by small-scale landownership. ‘Middle-class lordship’ was critically important for this divergence. The peasants of inland Flanders acquired an unusual measure of control over seigneurial courts and their regulatory capacities, using them to stimulate the commercialization of society while thwarting experiments with agrarian capitalism. The Flemish evidence thus complicates narratives about feudalism in Europe, showing that the spectrum of possibilities in the political economy of lordship deserves closer scrutiny.