U2 Great Divergence

The Great Divergence

period of time when Europe gained power but Asia and other previously prosperous regions decline

What caused The Great Divergence?

Scientific revolution and industrialization

What happened before The Great Divergence?

Global Crisis of the 17th century

mercantilism

economic theory that a country should accumulate as much gold/silver currency as possible by not buying --> maximize exports, minimize imports

industrialization

time when society goes from agrarian to industrial

agrarian society

society where economy depends on crops

industrial society

society where economy depends on tech and mass production/division of labor

factors of production

resources needed for goods and services

land

type of factor of production, natural resources + space for production

labor

type of factor of production, human labor to make and sell

capital

type of factor of production, tools, money, and tech

Entrepreneurship

type of factor of production, the willingness to create business and profit

economic base

basic structure society built on (ex. division of labor, caste structure, slavery)

superstructure

non-basic industries and structures in economy (ex. government, religion, education, law, family)

who created the concept of base and superstructure?

Karl Marx

How did the Columbian Exchange change the economy?

turned small, rural, self-sufficient communities to globalization and technological advancement

consumer revolution

1600-1750 movement, change from frugality to mass consumption of luxury goods

How did trade affect the consumer revolution?

traded deals w/ colonies globally imported goods

How did society affect the consumer revolution?

status became important, leading to luxury consumption

How did the consumer revolution accelerate in the 1700s?

better quality of living, people could afford more luxury goods

Global Crisis of 17th Century

period of longer winters, political unrest, shift from feudalism to mercantilism, and revolts

What caused the Global Crisis?

Little Ice Age = less crops = continued to tax farmers to provide food for soldiers = sustained the war = more deaths = killed farmers = less crops = continued

Thirty Years' War

war from 1618 to 1648 of almost all Europeans; an example of a war that rulers taxed farmers to continue fighting in. During Global Crisis btw

Treaty of Westphalia

treaty after the 30 Years' War that established what it meant to be the "sovereign" of a state = led to European multistate system

How did wars change throughout the Global Crisis

wars initially fought against the Spanish empire or in support of Protestants. Now mostly among Europeans

Seven Years' War

war from 1756 to 1763, GB won and became dominant colonial power, taxed colonists to pay it off

What was the cause of the Seven Years' War?

British wanted lands in Americas that were already owned by the French

What happened after the Seven Years' War?

Britain dominated all colonialism w/o any more European competition + had American colonies pay taxes

How did the Treaty of Westphalia affect kingdoms?

unified Europe into far fewer states than before

How did European states tax their citizens?

negotiated with wealthy landowners, causing a bureaucracy of them

How did European states affect debt?

borrowed money to fund wars = created concept of national debt

Why did people want to create the EIC?

English merchants wanted to control spice trade

Who created the EIC and when?

Elizabeth I in 1600

What type of company was the EIC?

joint-stock company

Why was the EIC attractive to investors?

had limited liability

Limited liability

protection of business owners' personal assets; allowed investors to spend more without more risk

What did EIC initially export to get spices?

silver

What did EIC export afterwards to get spices?

clothes, silk, gunpowder, opium,, etc.

Pepper

common cheap bulk item spice product that EIC imported in

Where did pepper come from?

mostly India

Tea

important product EIC imported in

When did demand for tea boom in England?

when EIC began trading with Canton

Where did EIC import tea from?

Indonesia, India, China

Cloth textile

Indian clothing

Did EIC initially want to import Indian cloth?

no; wanted to sell their own cloth to the East in exchange for buying spices. But Indian cloth was better

How did Indian cloth affect trade policies?

outcompeted English cloth, Parliament banned use of the cloth from 1700 to 1774

How did the ban on Indian cloth affect the EIC?

EIC re-exported Indian cloth to other countries

How was the Mughal Empire in the 1750s?

collapsing in 1750, provinces are breaking away from the empire

Why did the Mughal Empire fall into chaos?

heavy tax on peasants; relied on heavy conquests to provide loot for large army, resulted in antagonizing surrounding kingdoms

How did the EIC interact with the Mughal Empire?

EIC defeated the empire and conquered Bengal, transformed from company to political body

What did the EIC do after conquering Bengal?

continued to annex territory. Expenses of its wars drove it to bankruptcy

East India Company Act of 1784

act that made EIC transfer its political power to the British government

Dutch East India Company

A company founded by the Dutch for trade w/ Asia

What was the Dutch EIC inspired by?

Inspired by Company of Far Lands, first Amsterdamn based investmet company

What was the goal of the Dutch EIC?

Oust Portugal's control over spice trade

Was the Dutch East India Company political?

Yes; was a political ruling body, can hire whoever and wage war whenever

What was different about the Dutch EIC from other companies?

Had fractional share concept + meant to be a long lasting company, not short-term

Fractional share concept

Investors can buy a portion of a single share of a company, not entire; less risky

Why was the Dutch EIC stronger than the EIC?

Dutch EIC more unified (funded under government) but EIC was a collection of different trading posts that competed with each other within the company

Why could the Dutch EIC borrow at low interest rates?

Thriving = trusted they could pay back. Dutch government also diverted regular taxes to the DEIC = more rich

Where did the Dutch EIC establish a monopoly?

Spice monopoly in Banda Islands, Indonesia

How was the relationship between the Dutch EIC and the Bandanese?

Bad; DEIC tricked Bandanese into signing exclusive trade agreements. When Bandanese unknowingly violated them by trading with other countries, DEIC waged war

Jan Pieterszoon Coen

Military leader of Dutch EIC; carried out ethnic cleansing of Bandanese by replacing them with slaves under DEIC control

Why did the Dutch EIC decline?

English products (sugar/cotton) outcompeted Dutch products (nutmeg/wool)

When did the Dutch EIC go bankrupt?

1799

Industrial Revolution

movement from agriculture to tech

What started the Industrial Revolution in Britain?

advanced scientific thought, economic freedom (unlike other countries that always had tariffs), liberal culture that favored hard work and free trade, a lot of intellectuals and wealthy people

Did China industrialize?

Yes somewhat in Song Dynasty

How did China industrialize in the Song Dynasty

switched fuel from wood to coal and built new transportation

What prevented China from fully industrializing?

lack of source power (ie. steam engine) and political instability + lack of motivation

Was there a reason for China to industrialize?

not really, since they had a large population = a lot of labor and land = no need for inventions to help production

What caused China's economic downfall?

isolationism in the Ming Dynasty

Why did Ming Dynasty China isolate itself?

xenophobia after coming out of foreign Mongol rule; expelled foreign traders, banned foreign culture, and banned travel in and out of China

How was China's economic state different from Britain's?

Britain had more economic freedom; China's government controlled markets

British Agricultural Revolution

period of selective breeding/crop rotation/new machinery, better agricultural productivity in GB; led to Industrial Revolution

The Enclosure Acts

laws that enclosed and privatized British land; increased agricultural productivity but drove away farmers who worked on the land

What was one cause of the Enclosure Acts?

Wool became more expensive --> landowners claimed the lands and turned them from farms to pastures

What was another cause of the Enclosure Acts?

Black death killed people --> less labor --> harvest decreased --> living peasants could not sustain themselves --> peasants left --> became pasture --> landowners claimed land for pasture

How did the Enclosure Acts increase agricultural productivity?

How did the Enclosure Acts harm farmers?

kicked out farmers from homes

Enlightenment

a European intellectual movement of the late 17th and 18th centuries emphasizing reason and individualism rather than tradition

What ideas did the Enlightenment support?

individual liberty, religious tolerance, progress, and natural rights

individual liberty

concept that people have rights and freedoms that cannot be taken away without due process

religious tolerance

concept of accepting other religious beliefs and practices

progress

concept of pursuing reform and advancements in society, technology, science, etc.

natural rights

concept that people are born with inherent rights

Why did the Enlightenment happen?

globalization/new ideas spread + questions against authority + scientific progress + increased quality of life + France was a center of learning

Rene Descartes

Philosopher known for 'I think, therefore I am'. BEFORE Enlightenment

Francis Bacon

Philosopher who developed the scientific method. BEFORE enlightenment

Isaac Newton

Scientist who discovered laws of motion and gravity, lived before/during enlightenment

autocracy

government where one person has absolute power

Machiavelli

founder of modern political science, Italian Renaissance politician and historian

The Prince

book written by Machiavelli

What were Machiavelli's beliefs?

better feared than loved, must take immoral actions to achieve peace (ends justify means), be pragmatic (has criticized Christianity)

Thomas Hobbes

English philosopher that grew up during political unrest

What did Thomas Hobbes believe about humans?

Believed humans were naturally selfish and without law and order, they would get into conflict with one another

What concept did Thomas Hobbes defend?

social contract

social contract

agreement between people and government to give up right so government brings peace and order

What did Thomas Hobbes advocate for?

Absolutist monarchy

John Locke

English philosopher, championed democracy