4.5: The Economics of Empire Building: Mercantilism

Economics of Empires Building

• Economic strategies to consolidate and maintain power

  • Economic strategies

    • 1. Mercantilism

      • A state-driven economic system that emphasizes the buildup of mineral wealth by maintaining a favorable balance of trade

        • Favorable balance of trade

          • Merchants wanted more exports than imports

            • Mercantilism was a powerful motivation for establishing and growing empires because, among many other reasons once a colony was established, it created a kind of closed market to purchase exports from the imperial parent country.

    • 2. Joint-stock Company

      • Limited liability business, often charted by the state, which was funded by a group of investors

        • Investor could only lose the money they invested in the business

        • government approved this business and in doing so often granted it trade monopolies in various regions

        • This was a big innovation in how businesses were funded as they were privately funded, not state-funded

          • Dutch East India Company

            • Charted in 1602 by the Dutch State who subsequently granted the company a monopoly on trade in the Indian Ocean

              • The company’s investors became exceedingly rich

              • The Dutch imperial government was able to expand its power and influence across many places throughout the Indian Ocean.

                • States like Spain and Portugal were mainly funding their trade and imperial ventures through the state

• Trade Network: change and continuity

  • Change:

    • Atlantic system: The movement of goods, wealth and laborers between the eastern and westerns hemispheres.

    • importance of sugar

    • Silver was king

      • Effects of Silver

        • 1. Satisficed Chinese Demand for silver

          • Further developed the commercialization of their economy

        • 2. Increased profits

          • The goods silver purchased in Asian markets like silk, porcelain, and steel, were traded across the Atlantic system resulting in more profits.

    • Coerced labor

      • Coerced labor Systems

        • 1. Forced indigenous labor

        • 2. indentured servitude

        • 3. Enslaved Africans

  • Continuity:

    • 1. Afro-Eurasian Markets thrived

      • Regional markets across Afro-Eurasia continued to flourished and increase their reach

    • 2. Asian Land Routes

      • overland routes like the silk roads almost entirely controlled by Asian land-based powers, notably Ming China, and then the Qing dynasty

    • 3. Peasant and Artisan Labor

• Social effects

  • 1. Gender imbalance

  • 2. changed family structure

    • Polygyny - Practice of man marrying more than one women

  • 3. Cultural synthesis

    • Creole language

• Changing Belief Systems

  • Spanish and Portuguese Christianity and South America

    • They were interested in ensuring everybody in the whole world worshiped jesus

    • Use the church as an instrument to spread Christianity among the indigenous people

      • → B/c the church made prodigious use of the Printing press

        • → These ideas spread rapidly and efficient