They had clocks. At least, Bilbo did, as this quote from The Hobbit shows:
Quote:
'If you had dusted the mantlepiece, you would have found this just under the clock,' said Gandalf
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I can't recall any other mentions of clocks being used anywhere else in Middle Earth. A clock in the Shire was probably considered a rare luxury, affordable only by richer hobbits such as Bilbo.