Growth of Capitalism

Columbian Exchange

• Europeans began trading with the world after the age of exploration.
• This began what would be called the Columbian Exchange.
• Columbian Exchange: the movement of goods, people, ideas, and even diseases across the Atlantic.

Commercial Revolution

• The Columbian Exchange led to what is called a commercial revolution.  
• Commerce: the buying and selling of goods in large quantities over long distances. 
• Supply: the amount of a product available for purchase and Demand- how many people want that product.  (If supply is high and demand is low, a product is cheap.  If supply is low and demand is high, a product is more expensive.)

Capitalism

• Capitalism: private ownership of business and production for a profit.  (People own a business to make their own money!)
• Government regulates trade (mercantilism), but people own the businesses that are doing the trading (capitalism).
• This leads to a growing middle class of merchants and ship owners.

Risk

• Commerce led to the rise of the entrepreneur.  
• Entrepreneur: risks money in hopes of earning a profit.
• Some risks were to large for one person so joint-stock companies were created.
• Joint-stock company: allowed individual entrepreneurs to buy stocks, or shares, in a company.  
• Wealth from trade brought about a new social class- a group of people who share similar position in society.
• Middle Class: group made up of artisans and merchants. \n