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Demian chronicles the intellectual and emotional development of Emil Sinclair, the protagonist and narrator of the story. Thus, to analyze Sinclair in this book is to analyze his development. Sinclair begins the novel as a mentally precocious ten-year-old boy. He has a jumble of thoughts, but no real sense of what to make of them. He has a sense that there is more to the world than what he learns in school and from his parents. The first steps he makes into the other world occur in his interaction with Kromer. This episode takes from the young Sinclair some of his innocence. However, at such a young age, he is in no way prepared to move into the world of darkness. Similarly, he is enthralled by the types of heretical thought that Demian presents to him concerning the story of Cain. Yet, he doesn't really know how to deal with this type of thought. He has yet to develop a framework within which to understand and place such radical thought. This explains why, once Demian has freed him from Kromer, Sinclair attempts to return to the security of his parents' protection. He has had a taste of a world beyond, and tempting as it is, it scares him and challenges him more than he can handle.

As he grows older and interacts with Demian more, Sinclair begins to see beyond the strict system of laws that has been set forth for him. As an adolescent, he is more interested in women than confirmation classes; more importantly, he is perfectly comfortable with this. He is beginning to privilege his desires above the holy.

At the start of his time in preparatory school, Sinclair makes another attempt to escape thinking about the world. He begins going to bars—this is an escape just like living in a sheltered, holy world, but an escape to an opposite extreme. However, he discovers a purpose in life, something to attain to in the form of Beatrice and he reforms his ways. In finding the archetype of the person he wishes to obtain, Sinclair develops an immensely strong desire. This desire begins to drive him to act in completely different ways. This entire experience demonstrates that he has begun to grasp the importance of following the desires of his true soul.

Still, Sinclair has much to learn. The interaction with Pistorius is particularly important in this regard. In Pistorius, Sinclair finds a mentor, whom he eventually outgrows. By seeing himself in the context of Pistorius, Sinclair comes to see that he, himself, is far more original and creative. Through this interaction, he gains more self-confidence, something that is key to his ultimate ability to break free.

Finally, Sinclair meets back up with Demian while he is at university. By now, he has essentially rejected his Christian upbringing and standard societal mores. He is ready to fulfill his greatest desire, in meeting Frau Eva. Here, he finally gets to bask in the glory of a truly welcoming community where, for the first time in his life, he feels at home. However, all this only gives him the basis to strike out on his own. As Demian departs from him for the last time, Sinclair is ready to face the world alone. He is confident in his decision to live, attempting to fulfill the desires of his soul and he no longer needs Demian or Eva to constantly support him.

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