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===Iron Age, 500 BC–1200 AD=== [[File:Āraišu ezerpils 2001-05-26.jpg|thumbnail|right|[[Āraiši lake dwelling site]] dates back to the late Iron Age]] With the introduction of iron tools during the early [[Iron Age]] (500 BC – 1st cent. BC), agriculture was greatly improved and became the dominant economic activity. Bronze, traded from foreigners since Latvia has no copper or tin, was used for making a wide variety of decorative ornaments.<ref name="lnvm.lv"/> Starting from the Middle Iron Age (400–800 AD) the local inhabitants began to form distinct ethnic and regional identities. Baltic peoples eventually became the [[Curonians]], [[Semigallians]], [[Latgalians]] and [[Selonians]], while Finnic peoples became the [[Livonians]], [[Estonians]] and [[Vends]]; local [[chiefdom]]s emerged. At the beginning of the current era, the territory known today as [[Latvia]] became famous as a trading crossroads. The renowned [[trade route from the Varangians to the Greeks]] mentioned in ancient chronicles stretched from [[Scandinavia]] through Latvian territory via [[Daugava]] to the ancient [[Kievan Rus']] and [[Byzantine Empire]]. The ancient Balts actively participated in this trading network. Across Europe, Latvia's coast was known as a place for obtaining [[amber]] and Latvia sometimes is still called ''Dzintarzeme'' (Amberland). Up to and into the [[Middle Ages]], amber was more valuable than gold in many places. Latvian amber was known in places as far away as [[Ancient Greece]] and the [[Roman Empire]], and the [[Amber Road]] was intensively used for the transport of amber to the south of Europe. During the [[Vendel Period]] a Scandinavian settlement was established near the town of [[Grobiņa]], most likely by people from [[Gotland]]. This colony which numbered a few hundred people existed from a date between 650 and 850 AD. Many chronicles mention that Curonians paid a tribute to Swedish kings. During the Late Iron Age (800–1200 AD) the [[three-field system]] was introduced, rye cultivation began, and the quality of local craftsmanship improved with the introduction of the [[potter's wheel]] and better metal working techniques. Arab, Western European and Anglo-Saxon coins dating from this era have been found. A network of wooden hill-forts was built, which provided control and security over the land.<ref>{{Cite web |url=http://letonika.lv/groups/default.aspx?title=V%C4%93lais%20dzelzs%20laikmets/32098 |title=Vēlais dzelzs laikmets |access-date=March 30, 2016 |archive-date=October 27, 2020 |archive-url=https://web.archive.org/web/20201027151605/https://www.letonika.lv/groups/default.aspx?title=V%C4%93lais |url-status=live }}</ref>
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