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In 1395 Craiova was probably the scene of a victory won by the Wallachian Prince Mircea I of Wallachia over Bayezid I, Sultan of the Ottomans (see Battle of Rovine).
Frequently referred to as "a city" after the first half of the 16th century, the Craiova area was always regarded as an important economic region of Wallachia and Romania at large.
The number of large industrial establishments rose to 40 by 1925.
Banking also developed at the beginning of the 20th century (when 6 banks and 2 bureaux de change were already operating).
This power gave them a statute of political autonomy so big, that the hospodars ruling at that time weren't able to keep in power without an alliance with this powerful dynasty.
From the Craiovești family there were chosen a lot of hospodars to rule the country: Neagoe Basarab, Radu de la Afumați, Radu Șerban (1602–1611), Matei Basarab, Constantin Șerban, Șerban Cantacuzino, Constantin Brâncoveanu.
In the early 1960s, under the Communist regime, the city became a noted centre for the automotive and engine building industries, as well as for aerospace manufacturing, chemical industry, food industry, construction, electrical engineering, mining and the electrical power industry.
After the 1989 Revolution brought the re-establishment of a free market and decentralisation in overall management, several industries became subject to privatisation, while the market opened itself to private initiatives.
It is a longstanding political center, and is located at approximately equal distances from the Southern Carpathians (north) and the River Danube (south).During the Wallachian uprising of 1821, inhabitants of the present-day Dolj County joined Tudor Vladimirescu's Pandurs in great numbers, contributing to the expedition on Bucharest.During the first two decades of the 19th century, Craiova witnessed economic prosperity, centered on handicraft trades and public services.Around 1860, there were 4,633 buildings in Craiova, which were 3,220 houses, 26 churches, 11 schools and 60 factories and workshops.In all, the city also housed about 90 industrial establishments, of which 12 were mills, 3 breweries, 2 gas and oil factories, 4 tanning yards and 2 printing presses; 57% of the total number of craftsmen of Dolj County lived in Craiova (1,088 craftsmen, 687 journeymen and 485 apprentices).