The inhabitants are ruled by a feudal regime that is overdue to transition to a state and mercantile economy. Think of it as any European major power in the sixteen and seventeen hundreds with a society of wizardry to go alongside the feudal and church institutions. Everything is subject to the arbitrary laws of the king and nobility, enforced by the Church of Saga and hundreds of local armies.
Instead of the colonial experience of our past, Illag is surrounded by a wilderness filled with dangerous monsters. The country fights irredeemable monster hoards on its perimeter while the nobles of the interior engage in constant battles with each other. Neighbouring nations are always ready for any sign of weakness to launch an attack.
The widespread use of magic has made the development of gunpowder unnecessary.
There is a lot going on behind the scenes in The Sword that Forged a Man series. This is how it works.