The paper claims that nagarshethship in Ahmedabad was an innovation in urban institution. Challenging the popularly held view that the institution began with Emperor Jehangir conferring this title on a principal merchant, the authors emphasize that the institution had a more spontaneous beginning and evolved gradually. It became hereditary after a Moghul emperor accorded official sanction to it in 1732. However, the rise of more formal institutions and the growth of industrial leadership after the establishment of the British rule, the institution became superfluous and gradually disappeared. Regretting that the conventional periodization of Indian history has hampered the study of institutional histyory, the authors plead for problem oriented rather than period based research.