THE WORLD THE WORLD ECONOMYECONOMY

EXCHANGES, CAPTIALISM, EXCHANGES, CAPTIALISM, COLONIALISM, AND COLONIALISM, AND EMPIRE BUILDINGEMPIRE BUILDING

CHINESE CHINESE RECONNAISSANCERECONNAISSANCE

► Ming ChinaMing China Expel Mongols, reestablish traditional Chinese institutionsExpel Mongols, reestablish traditional Chinese institutions

► Reestablish Chinese tributary system; reestablish East Asian tradeReestablish Chinese tributary system; reestablish East Asian trade► Resurrects Chinese fleetResurrects Chinese fleet

22ndnd Ming Emperor seizes control from nephew Ming Emperor seizes control from nephew► Nephew flees abroadNephew flees abroad► Emperor sends fleet to find nephew, reestablish Chinese influence, trade, tributeEmperor sends fleet to find nephew, reestablish Chinese influence, trade, tribute

► The Chinese reconnaissance of the Indian Ocean basin The Chinese reconnaissance of the Indian Ocean basin Zheng He's expeditions Zheng He's expeditions

► Ming emperor permitted foreigners to trade at Quanzhou and Guangzhou Ming emperor permitted foreigners to trade at Quanzhou and Guangzhou ► Refurbished the navy and sent seven large expeditions to the Indian Ocean basin Refurbished the navy and sent seven large expeditions to the Indian Ocean basin ► Purposes: to control foreign trade and impress foreign peoples Purposes: to control foreign trade and impress foreign peoples ► Admiral Zheng He's ships were the largest marine crafts in the world Admiral Zheng He's ships were the largest marine crafts in the world ► Visited southeast Asia, India, Ceylon, Arabia, and east AfricaVisited southeast Asia, India, Ceylon, Arabia, and east Africa

Chinese naval power Chinese naval power ► Zheng He's voyages diplomatic: exchanged gifts, envoys Zheng He's voyages diplomatic: exchanged gifts, envoys ► Used force to impress foreign powers, for example, against coastal pirates Used force to impress foreign powers, for example, against coastal pirates ► Expeditions enhanced Chinese reputation in the Indian Ocean basinExpeditions enhanced Chinese reputation in the Indian Ocean basin

► End of the voyages, 1433 End of the voyages, 1433 Confucian ministers mistrusted foreign alliances Confucian ministers mistrusted foreign alliances Resources redirected to agriculture and defense of northern borders Resources redirected to agriculture and defense of northern borders Technology of building large ships was forgotten, nautical charts destroyedTechnology of building large ships was forgotten, nautical charts destroyed

EUROPEAN EXPLORATIONEUROPEAN EXPLORATION► European exploration in the Atlantic and Indian Oceans European exploration in the Atlantic and Indian Oceans

Portuguese exploration Portuguese exploration ► European goals: to expand Christianity and commercial opportunities European goals: to expand Christianity and commercial opportunities ► Portuguese mariners emerged as the early leaders Portuguese mariners emerged as the early leaders ► Prince Henry of Portugal determined to increase Portuguese influence Prince Henry of Portugal determined to increase Portuguese influence ► Seized Moroccan city of Ceuta in 1415Seized Moroccan city of Ceuta in 1415

Colonization of the Atlantic Islands Colonization of the Atlantic Islands ► Portuguese ventured into the Atlantic, colonized Madeiras, Azores, other Portuguese ventured into the Atlantic, colonized Madeiras, Azores, other

islands islands ► Italian investors, Portuguese landowners cultivated sugarcane on the Italian investors, Portuguese landowners cultivated sugarcane on the

islands islands Slave trade expanded fifteenth century Slave trade expanded fifteenth century

► Portuguese traders ventured down west coast of Africa Portuguese traders ventured down west coast of Africa ► Traded guns, textiles for gold and slaves Traded guns, textiles for gold and slaves ► Thousands of slaves delivered to Atlantic island plantations Thousands of slaves delivered to Atlantic island plantations

► Indian Ocean trade Indian Ocean trade Portuguese searched for sea route to Asian markets without Muslim Portuguese searched for sea route to Asian markets without Muslim

intermediaries intermediaries Portuguese mariners dominated trade between Europe and Asia, sixteenth Portuguese mariners dominated trade between Europe and Asia, sixteenth

century century Portuguese ships with cannons launched European imperialism in AsiaPortuguese ships with cannons launched European imperialism in Asia

► Christopher Columbus hoped to reach Asia by sailing west Christopher Columbus hoped to reach Asia by sailing west Plan rejected by Portuguese king but sponsored by king and queen of Spain Plan rejected by Portuguese king but sponsored by king and queen of Spain 1492, led three ships to the Caribbean Sea, believed he was near Japan 1492, led three ships to the Caribbean Sea, believed he was near Japan Other mariners soon followed Columbus and explored American continentsOther mariners soon followed Columbus and explored American continents

MOTIVES FOR MOTIVES FOR EXPLORATIONEXPLORATION

► Portugal searched for fresh resources Portugal searched for fresh resources Resource poor country block from expanding on landResource poor country block from expanding on land 1313thth to 15 to 15thth century they ventured out onto Atlantic century they ventured out onto Atlantic Established sugar plantations in Azores, MadieraEstablished sugar plantations in Azores, Madiera

► Direct trade without Muslim intermediaries Direct trade without Muslim intermediaries Bypass Italian trade monopolies with OttomansBypass Italian trade monopolies with Ottomans Asian spice trade Asian spice trade African gold, ivory, and slavesAfrican gold, ivory, and slaves

► Missionary efforts of European Christians Missionary efforts of European Christians Christians urged to spread the faith throughout the Christians urged to spread the faith throughout the

world world Crusades and holy wars against Muslims in early Crusades and holy wars against Muslims in early

centuries centuries ReconquistaReconquista of Spain inspired Iberian crusaders of Spain inspired Iberian crusaders

► Motives Motives Gold, glory, GodGold, glory, God Combined and reinforced each otherCombined and reinforced each other

INFLUENCE OF INFLUENCE OF TECHNOLOGYTECHNOLOGY

► New technologies help Europeans travel New technologies help Europeans travel offshore offshore Sternpost rudder Sternpost rudder Two types of sails Two types of sails New types of ships New types of ships Advance, sail against wind Advance, sail against wind

► Navigational instruments Navigational instruments Magnetic compass Magnetic compass Astrolabe (and cross and back staffs) Astrolabe (and cross and back staffs)

► Knowledge of winds and currents Knowledge of winds and currents Enabled Europeans to travel reliably Enabled Europeans to travel reliably Trade winds north and south of the equator Trade winds north and south of the equator Regular monsoons in Indian Ocean basin Regular monsoons in Indian Ocean basin The The volta do marvolta do mar

VOYAGES OF VOYAGES OF EXPLORATIONEXPLORATION

► Henrique, King of PortugalHenrique, King of Portugal Encouraged exploration of west Africa Encouraged exploration of west Africa Portuguese conquered Ceuta in north Africa in 1415 Portuguese conquered Ceuta in north Africa in 1415 Established trading posts at Sao Jorge da Mina, west Africa Established trading posts at Sao Jorge da Mina, west Africa Dias rounded the Cape of Good Hope, entered Indian Ocean, Dias rounded the Cape of Good Hope, entered Indian Ocean,

14881488► Vasco da Gama of Portugal Vasco da Gama of Portugal

Crossed Indian Ocean; reached India, 1497Crossed Indian Ocean; reached India, 1497 Brought back huge profit Brought back huge profit Portuguese merchants built a trading post at Calicut, 1500Portuguese merchants built a trading post at Calicut, 1500

► Christopher Columbus, Genoese mariner Christopher Columbus, Genoese mariner Proposed sailing to Asian markets by a western route Proposed sailing to Asian markets by a western route Sponsored by Catholic kings of Spain; sailed to Bahamas in Sponsored by Catholic kings of Spain; sailed to Bahamas in

14921492► Columbus's voyage inspired othersColumbus's voyage inspired others

England, France, Holland begin to exploreEngland, France, Holland begin to explore Spain, Portugal sent out more expeditions, conquistadors Spain, Portugal sent out more expeditions, conquistadors

OTHER VOYAGESOTHER VOYAGES► Ferdinand Magellan, Portuguese navigator, in service of Spain Ferdinand Magellan, Portuguese navigator, in service of Spain

Crossed both the Atlantic and Pacific Oceans 1519-1522 Crossed both the Atlantic and Pacific Oceans 1519-1522 One ship out of five completed the circumnavigation of the world One ship out of five completed the circumnavigation of the world Magellan died in conflict in a Philippine island on the way homeMagellan died in conflict in a Philippine island on the way home

► Exploration of the Pacific took three centuries to complete Exploration of the Pacific took three centuries to complete Trade route between the Philippines and Mexico, by Spanish merchants Trade route between the Philippines and Mexico, by Spanish merchants Other European mariners searched for a northwest passage from Europe Other European mariners searched for a northwest passage from Europe

to Asiato Asia► The English, French, DutchThe English, French, Dutch

France: Explored Northern North America, Settled Canada, exploited France: Explored Northern North America, Settled Canada, exploited fursfurs

EnglishEnglish► Atlantic seaboard of North America, Hudson Bay areaAtlantic seaboard of North America, Hudson Bay area► English East India Company opened Indian Ocean to English tradeEnglish East India Company opened Indian Ocean to English trade

DutchDutch► Tended to prey on Spanish, Portuguese existing holdingsTended to prey on Spanish, Portuguese existing holdings► Won independence from Spain, seized control on much of Indian OceanWon independence from Spain, seized control on much of Indian Ocean► Dutch East India company established to exploit Indian possessions Dutch East India company established to exploit Indian possessions

► By 18By 18THTH century, Europeans had accurate knowledge of the world century, Europeans had accurate knowledge of the world

GLOBAL EXCHANGESGLOBAL EXCHANGES► Biological exchanges between Old and New Worlds Biological exchanges between Old and New Worlds

Columbian ExchangeColumbian Exchange► Global diffusion of plants, food crops, animals, human populations, diseasesGlobal diffusion of plants, food crops, animals, human populations, diseases► Columbus's voyages began and explorations furthered exchangeColumbus's voyages began and explorations furthered exchange► All continents effected All continents effected

Permanently altered the earth's environment Permanently altered the earth's environment ► Epidemic diseasesEpidemic diseases

Smallpox, measles, diphtheria, whooping cough, and influenzaSmallpox, measles, diphtheria, whooping cough, and influenza Led to staggering population losses Led to staggering population losses Smallpox reduced Aztec population by 95 percent in one century Smallpox reduced Aztec population by 95 percent in one century Contagious diseases had same horrifying effects in the Pacific islands Contagious diseases had same horrifying effects in the Pacific islands Between 1500/1800, 100 million people died of imported diseasesBetween 1500/1800, 100 million people died of imported diseases

► New foods and domestic animals New foods and domestic animals Wheat, horses, cattle, sheep, goats, and chickens went to Americas Wheat, horses, cattle, sheep, goats, and chickens went to Americas American crops included maize, potatoes, beans, tomatoes, peppers, American crops included maize, potatoes, beans, tomatoes, peppers,

peanuts peanuts ► Growth of world population: from 425 million in 1500 to 900 million Growth of world population: from 425 million in 1500 to 900 million

in 1800in 1800► Migration of human populations Migration of human populations ► Enslaved Africans were largest group of migrants from 1500 to 1800 Enslaved Africans were largest group of migrants from 1500 to 1800 ► Sizable migration from Europe to the Americas Sizable migration from Europe to the Americas

ORIGINS OF EUROPEAN ORIGINS OF EUROPEAN TRADETRADE

► European intermediariesEuropean intermediaries Comparative AdvantageComparative Advantage

► Country can do many things but it will excel in some over othersCountry can do many things but it will excel in some over others► Countries develop trade based on comparative advantageCountries develop trade based on comparative advantage

Advantage is based on where the nation has greatest advantageAdvantage is based on where the nation has greatest advantage Concentrate economic resources in that areaConcentrate economic resources in that area

► European advantage was to act as middle men and shipping for othersEuropean advantage was to act as middle men and shipping for others Absolute AdvantageAbsolute Advantage

► One country has natural advantage in producing certain goods, servicesOne country has natural advantage in producing certain goods, services► Absolute advantage is often a natural monopolyAbsolute advantage is often a natural monopoly► Asians produced spices, goods, which Europeans could not Asians produced spices, goods, which Europeans could not ► Europeans began by trading with silver, goldEuropeans began by trading with silver, gold

European establish monopoliesEuropean establish monopolies► Europeans establish chock points at areas where all trade had to passEuropeans establish chock points at areas where all trade had to pass► Seized lands where spices grown, destroy competition, create monopolySeized lands where spices grown, destroy competition, create monopoly

► Transoceanic tradeTransoceanic trade European merchants created global trading system European merchants created global trading system Based on supply and demand; linked ports of the world Based on supply and demand; linked ports of the world

► Manila galleons Manila galleons Heavily armed ships sailed between Manila, Mexico Heavily armed ships sailed between Manila, Mexico Asian luxury goods to Mexico; Silver from Mexico to ChinaAsian luxury goods to Mexico; Silver from Mexico to China East Asia became dependent on American silver East Asia became dependent on American silver

WORLD TRADEWORLD TRADE► Terms of TradeTerms of Trade

Agreements on what will be exchangedAgreements on what will be exchanged Agreements on payments, amounts to be exchangedAgreements on payments, amounts to be exchanged Bilateral is when two nations negotiate equallyBilateral is when two nations negotiate equally

► Europeans had to negotiate with China, Japan, Muslims, Russia (too Europeans had to negotiate with China, Japan, Muslims, Russia (too powerful)powerful)

► Only allowed to trade though one portOnly allowed to trade though one port Canton (Guangzou) in ChinaCanton (Guangzou) in China Nagasaki in JapanNagasaki in Japan

Unilateral is when one nation dictates terms of tradeUnilateral is when one nation dictates terms of trade► Composition of TradeComposition of Trade

Europe and TradeEurope and Trade► Europeans traded finished goods, especially manufactured( Guns, cloths)Europeans traded finished goods, especially manufactured( Guns, cloths)► Europeans purchased unfinished goods to trade (Silver, sugar)Europeans purchased unfinished goods to trade (Silver, sugar)► Europeans sought luxuries, spices, slaves, gems, silks, porcelainEuropeans sought luxuries, spices, slaves, gems, silks, porcelain

World and TradeWorld and Trade► Low-cost goods: gold, silver; sugar, spice, tobacco, cotton; slaves Low-cost goods: gold, silver; sugar, spice, tobacco, cotton; slaves ► Africa, Latin America became one commodity exporters Africa, Latin America became one commodity exporters ► E. Europe sold commodities through W. Europe (grains, timber, tar, fish)E. Europe sold commodities through W. Europe (grains, timber, tar, fish)► E. Asia, S. Asia, S.E. Asia, S.W. Asia: balanced agreements of tradeE. Asia, S. Asia, S.E. Asia, S.W. Asia: balanced agreements of trade

► Balance of TradeBalance of Trade Amount to the profit or loss involved in tradeAmount to the profit or loss involved in trade Europeans had an enormous surplus or positive balance of tradeEuropeans had an enormous surplus or positive balance of trade

INTERNATIONAL INTERNATIONAL INEQUALITIESINEQUALITIES

► International InequalityInternational Inequality Center or Core of world trade was Western EuropeCenter or Core of world trade was Western Europe

► Most of world in an unequal relationship to EuropeMost of world in an unequal relationship to Europe► Most countries did not control own economiesMost countries did not control own economies

Local trading elites often grew rich tradingLocal trading elites often grew rich trading► Worked with Western Europeans on seas, coastsWorked with Western Europeans on seas, coasts► Controlled their own interior economiesControlled their own interior economies

Most of locals not involved in world economyMost of locals not involved in world economy► Population existed at subsistence levelPopulation existed at subsistence level► Contacts limited to coasts, portsContacts limited to coasts, ports

► Coercive LaborCoercive Labor Most of world labor was unfreeMost of world labor was unfree Slavery differed little from serfdom, caste slavery, peasantsSlavery differed little from serfdom, caste slavery, peasants Profits often depended on keeping labor cheapProfits often depended on keeping labor cheap Europeans often established plantations with cheap laborEuropeans often established plantations with cheap labor

WAS THERE A WORLD WAS THERE A WORLD ECONOMY, c. 1600?ECONOMY, c. 1600?

► YesYes Western EuropeWestern Europe

► European Atlantic SeaboardEuropean Atlantic Seaboard► Colonial possessions in North America, South AmericaColonial possessions in North America, South America

Poland and RussiaPoland and Russia Coasts of West, East AfricaCoasts of West, East Africa Coasts of India, S.E. Asia, E. AsiaCoasts of India, S.E. Asia, E. Asia Muslim S.W. AsiaMuslim S.W. Asia

► NoNo European areas of Ottoman EmpireEuropean areas of Ottoman Empire Interior of AfricaInterior of Africa Interior (steppes, deserts) of EurasiaInterior (steppes, deserts) of Eurasia Interior of South AsiaInterior of South Asia IndochinaIndochina Australia and New ZealandAustralia and New Zealand Interior of North and South AmericaInterior of North and South America Pacific islands of Micronesia, Polynesia, MelanesiaPacific islands of Micronesia, Polynesia, Melanesia

EAST ASIAEAST ASIA► Benefited from global tradeBenefited from global trade

Allowed Limited ContactsAllowed Limited Contacts► Strong government disincentives to tradeStrong government disincentives to trade► Used Chinese navy to keep pirates, Europeans outUsed Chinese navy to keep pirates, Europeans out► Tended towards official isolationTended towards official isolation► Japan, Korea equally apprehensiveJapan, Korea equally apprehensive

Chinese manufacturing better than EuropeansChinese manufacturing better than Europeans► Tended towards luxury goodsTended towards luxury goods► Chinese demanded silver in paymentChinese demanded silver in payment

Not active participants on scale of EuropeNot active participants on scale of Europe► China failed to appreciate European threatChina failed to appreciate European threat

Neo-Confucianism clouded understandingNeo-Confucianism clouded understanding Technology considered beneath ChineseTechnology considered beneath Chinese Profits, trade considered inferior occupationsProfits, trade considered inferior occupations

► Japan understood impact of EuropeansJapan understood impact of Europeans Most troubled by European firearms as un-samuraiMost troubled by European firearms as un-samurai Eventually limited trade to one yearly ship at NagasakiEventually limited trade to one yearly ship at Nagasaki Officially closed Japan until 1854 Officially closed Japan until 1854

OTHER PARTS OF WORLDOTHER PARTS OF WORLD► Muslim World: Mughal India, Ottomans, SafavidsMuslim World: Mughal India, Ottomans, Safavids

Interested in trade, cooperated to a degreeInterested in trade, cooperated to a degree Allowed small port colonies to ariseAllowed small port colonies to arise External trade often handled by ethnic minorities External trade often handled by ethnic minorities Exchanged goods for silver, luxuries, processed goodsExchanged goods for silver, luxuries, processed goods Eventually became dependent on European manufactured Eventually became dependent on European manufactured

goodsgoods Internal expansion, development over external tradeInternal expansion, development over external trade

► RussiaRussia Agricultural economyAgricultural economy More concerned with steppe nomads, internal problemsMore concerned with steppe nomads, internal problems Not involved until 18Not involved until 18thth century century

► AfricaAfrica Except for coasts, Cape Colony generally outside world Except for coasts, Cape Colony generally outside world

economyeconomy Diseases, climate kept Europeans out of AfricaDiseases, climate kept Europeans out of Africa Contacts limited to coastal statesContacts limited to coastal states

COLONIAL EXPANSIONCOLONIAL EXPANSION► The AmericasThe Americas

Spain: Began with control of Caribbean, Invaded Mexico 1521, Peru 1531Spain: Began with control of Caribbean, Invaded Mexico 1521, Peru 1531 Portugal: Cabral visit coast of Brazil; Treaty of Tordesillas granted BrazilPortugal: Cabral visit coast of Brazil; Treaty of Tordesillas granted Brazil Colonies developed Colonies developed

► By small band land hungry conquistadors, colonial rulers exploit IndiansBy small band land hungry conquistadors, colonial rulers exploit Indians► Only later did formal Iberian rule replace corrupt conquistatorsOnly later did formal Iberian rule replace corrupt conquistators

Direct RuleDirect Rule► Colonial administrators sent out from Spain, PortugalColonial administrators sent out from Spain, Portugal► Established agricultural (ranching or plantation) coloniesEstablished agricultural (ranching or plantation) colonies► Colonial societies with Europeans at top created rarely had European majoritiesColonial societies with Europeans at top created rarely had European majorities► Missionaries sent out to covert IndiansMissionaries sent out to covert Indians

► English, French, Dutch create smaller empires on fringesEnglish, French, Dutch create smaller empires on fringes Caribbean holdings more profitable than North American coloniesCaribbean holdings more profitable than North American colonies Caribbean islands and Southern American coloniesCaribbean islands and Southern American colonies

► Export sugar, rice, tobacco, cotton, indigo riceExport sugar, rice, tobacco, cotton, indigo rice► Dominated by slaves, plantations; relied on importation of Africans for laborDominated by slaves, plantations; relied on importation of Africans for labor

Atlantic Seaboard: settler colonies for Europeans (called Neo-Europes)Atlantic Seaboard: settler colonies for Europeans (called Neo-Europes)► Land grants made to encourage colonizationLand grants made to encourage colonization► European populations surpassed native IndiansEuropean populations surpassed native Indians► European society, economic systems reestablished; mini copies of Western European society, economic systems reestablished; mini copies of Western

EuropeanEuropean► Europeans displaced, drove off most Indians and converted land to agricultureEuropeans displaced, drove off most Indians and converted land to agriculture

TRADING POST EMPIRESTRADING POST EMPIRES► No attempt to create empires but control trade, wealthNo attempt to create empires but control trade, wealth► Portuguese built 50+ posts between west Africa and east Asia Portuguese built 50+ posts between west Africa and east Asia

Alfonso d'AlbuquerqueAlfonso d'Albuquerque► 1616THTH century Portuguese commander in Indian Ocean century Portuguese commander in Indian Ocean ► Seized Hormuz in 1508, Goa in 1510, and Melaka in 1511 Seized Hormuz in 1508, Goa in 1510, and Melaka in 1511 ► Forced all merchant ships to purchase safe-conduct passes Forced all merchant ships to purchase safe-conduct passes

Portuguese hegemony grew weak by the late sixteenth centuryPortuguese hegemony grew weak by the late sixteenth century► English, Dutch established trading posts in Asian coasts English, Dutch established trading posts in Asian coasts

English in India, the Dutch at Cape Town and Indonesia English in India, the Dutch at Cape Town and Indonesia Created efficient commercial organizationCreated efficient commercial organization

► Joint-stock companyJoint-stock company Shares could be bought by anyone with moneyShares could be bought by anyone with money % of shares correspond to percentage of profit due% of shares correspond to percentage of profit due Allowed for larger, richer entities to operateAllowed for larger, richer entities to operate Limited risk of any one participant to cost of the stock purchasedLimited risk of any one participant to cost of the stock purchased Privileges, terms often guaranteed by government, which often also owned stockPrivileges, terms often guaranteed by government, which often also owned stock

► InsuranceInsurance Companies arose which insured venturesCompanies arose which insured ventures Lloyds of London is the oldest in worldLloyds of London is the oldest in world

► Formation of powerful, profitable joint-stock companies Formation of powerful, profitable joint-stock companies English East India Company, founded in 1600 English East India Company, founded in 1600 United East India Company (VOC), Dutch, founded in 1602 United East India Company (VOC), Dutch, founded in 1602 Private enterprises, enjoyed government support, little oversightPrivate enterprises, enjoyed government support, little oversight

EUROPEANS IN INDIAN EUROPEANS IN INDIAN OCEANOCEAN

► Posts were commercial ventures not areas of colonizationPosts were commercial ventures not areas of colonization► Portuguese controlled area initiallyPortuguese controlled area initially

Established ports in India, dominated trade to, from IndiaEstablished ports in India, dominated trade to, from India► Goa was capital for Indian Ocean Portuguese EmpireGoa was capital for Indian Ocean Portuguese Empire► Conquered Sri Lanka, several other ports with permission of MughalsConquered Sri Lanka, several other ports with permission of Mughals► Introduced Catholic missionaries to Indian Ocean Introduced Catholic missionaries to Indian Ocean

Seized port of Malacca on Malay peninsula to do same as in IndiaSeized port of Malacca on Malay peninsula to do same as in India► Traded with locals for spiceTraded with locals for spice► Later conquered parts of Spice Islands Later conquered parts of Spice Islands

► Spanish conquest of the Philippines Spanish conquest of the Philippines Manila, bustling port city, became Spanish capital; Spanish tended to live Manila, bustling port city, became Spanish capital; Spanish tended to live

in citiesin cities Islands divided into plantations to grow sugarIslands divided into plantations to grow sugar Spanish, Filipinos massacred Chinese merchantsSpanish, Filipinos massacred Chinese merchants Christianity spread by Dominicans throughout archipelago Christianity spread by Dominicans throughout archipelago Muslim resistance on southern island of MindanaoMuslim resistance on southern island of Mindanao

► Conquest of Java by the Dutch Conquest of Java by the Dutch Began with VOC trading city of Batavia in 1619Began with VOC trading city of Batavia in 1619 Drove Portuguese out, seized their possessions Drove Portuguese out, seized their possessions Policy: secure VOC monopoly over spice production, trade Policy: secure VOC monopoly over spice production, trade Enormous monopoly profit led to prosperity of NetherlandsEnormous monopoly profit led to prosperity of Netherlands Forced locals to grow rich, coffee in place of regular cropsForced locals to grow rich, coffee in place of regular crops

► English arrive 17English arrive 17thth century to attack Portugal, later displaced Dutch century to attack Portugal, later displaced Dutch Establish British East India CompanyEstablish British East India Company Relied heavily on Royal backing, Royal navy, and acquisition of Indian landsRelied heavily on Royal backing, Royal navy, and acquisition of Indian lands

COMMERICAL RIVALRIESCOMMERICAL RIVALRIES► Global competition and conflict Global competition and conflict

Dutch forces expelled most Portuguese merchants from southeast Asia Dutch forces expelled most Portuguese merchants from southeast Asia Conflict between English and French merchants over control of IndiaConflict between English and French merchants over control of India

► Began as rivalry with PortugueseBegan as rivalry with Portuguese► Each side made alliances with local rulers to establish trading rightsEach side made alliances with local rulers to establish trading rights► Cotton and tea from Ceylon, early eighteenth century Cotton and tea from Ceylon, early eighteenth century

Competition in the Americas among English, French, and Spanish forces Competition in the Americas among English, French, and Spanish forces ► Anglo-Dutch Wars (1640s to 1670s)Anglo-Dutch Wars (1640s to 1670s)

English and Dutch fight three wars for control of seasEnglish and Dutch fight three wars for control of seas English win and take New Netherlands (New York); Dutch reduced in world roleEnglish win and take New Netherlands (New York); Dutch reduced in world role

► War of Spanish Succession (1704-1714)War of Spanish Succession (1704-1714) Hapsburg family has no heirs to Spanish throneHapsburg family has no heirs to Spanish throne France set to inherit empire; England, Dutch, Austrians opposeFrance set to inherit empire; England, Dutch, Austrians oppose

► The Seven Years' War (1756-1763) The Seven Years' War (1756-1763) In Europe: British and Prussia against France, Austria, and Russia In Europe: British and Prussia against France, Austria, and Russia In India: fighting between British and French forces, each with local allies In India: fighting between British and French forces, each with local allies In the Caribbean: Spanish and French united to limit British expansion In the Caribbean: Spanish and French united to limit British expansion In North America: fights between British and French forcesIn North America: fights between British and French forces

► Outcome of All: British hegemony Outcome of All: British hegemony British gained control of India, Canada, FloridaBritish gained control of India, Canada, Florida Dutch allowed to retain Ceylon, South Africa, Indonesia as English allies Dutch allowed to retain Ceylon, South Africa, Indonesia as English allies In Europe, Prussian armies held off massive armies of the enemies In Europe, Prussian armies held off massive armies of the enemies War paved the way for the British empire in the nineteenth centuryWar paved the way for the British empire in the nineteenth century British influence paramount in Latin AmericaBritish influence paramount in Latin America

EARLY CAPITALISMEARLY CAPITALISM► First arose in Italian city-states, Dutch controlled NetherlandsFirst arose in Italian city-states, Dutch controlled Netherlands► Early capitalism and proto-industrializationEarly capitalism and proto-industrialization

Capitalism is use of capital, money, investments to create industry, profitCapitalism is use of capital, money, investments to create industry, profit► Relies on freedom to invest capital in most profitable ventureRelies on freedom to invest capital in most profitable venture► Relies on minimal government regulation and right of investors to make a profitRelies on minimal government regulation and right of investors to make a profit

The nature of capitalism The nature of capitalism ► Private parties sought to take advantage of free market conditions Private parties sought to take advantage of free market conditions ► Economic decisions by private parties, not by governments or nobility Economic decisions by private parties, not by governments or nobility ► Forces of supply and demand determined priceForces of supply and demand determined price

Supply and demand Supply and demand ► Merchants built efficient transportation and communication networks Merchants built efficient transportation and communication networks ► New institutions and services: banks, insurance, stock exchangesNew institutions and services: banks, insurance, stock exchanges

Joint-stock companies like EEIC and VOC organized commerce on a new scale Joint-stock companies like EEIC and VOC organized commerce on a new scale Capitalism actively supported by governments, especially England, Capitalism actively supported by governments, especially England,

Netherlands Netherlands ► Protected rights of private property, upheld contracts, settled disputes Protected rights of private property, upheld contracts, settled disputes ► Chartered joint-stock companies authorized to explore, conquer, and colonize distant landsChartered joint-stock companies authorized to explore, conquer, and colonize distant lands

The putting-out system of seventeenth and eighteenth centuries The putting-out system of seventeenth and eighteenth centuries ► Entrepreneurs bypassed guilds, moved production to countryside Entrepreneurs bypassed guilds, moved production to countryside ► Rural labor cheap, cloth production highly profitableRural labor cheap, cloth production highly profitable

► Mercantilism is government supported national capitalismMercantilism is government supported national capitalism Nations should not important products from outside its own empireNations should not important products from outside its own empire Goods should be shipped only on national shipsGoods should be shipped only on national ships National tariffs, taxes discourage importation, stimulate local productionNational tariffs, taxes discourage importation, stimulate local production Economic health reflected in positive balance of trade Economic health reflected in positive balance of trade Wealth measured in positive amounts of gold, silver earnedWealth measured in positive amounts of gold, silver earned All currencies backed by gold, silverAll currencies backed by gold, silver

EARLY CAPITALIST EARLY CAPITALIST SOCIETIESSOCIETIES► Mindset about capitalismMindset about capitalism

Profits and ethics Profits and ethics ► Medieval theologians saw profit making as selfish and sinful Medieval theologians saw profit making as selfish and sinful ► Renaissance altered concepts of wealth, profitRenaissance altered concepts of wealth, profit

ReformationReformation► Protestants saw success as vindication of God’s favorProtestants saw success as vindication of God’s favor► Many Protestants in upper middle class, Protestant states supported capitalismMany Protestants in upper middle class, Protestant states supported capitalism

► Population growth and urbanization Population growth and urbanization Population growth Population growth

► American food crops improved Europeans' nutrition and diets American food crops improved Europeans' nutrition and diets ► Increased resistance to epidemic diseases after the mid-seventeenth century Increased resistance to epidemic diseases after the mid-seventeenth century ► European population increased from 81 million in 1500 to 180 million in 1800European population increased from 81 million in 1500 to 180 million in 1800

Urbanization Urbanization ► Rapid growth of major cities (Paris from 130,000 in 1550 to 500,000 in 1650) Rapid growth of major cities (Paris from 130,000 in 1550 to 500,000 in 1650) ► Cities increasingly important as administrative and commercial centersCities increasingly important as administrative and commercial centers

► Social change in early modern Europe Social change in early modern Europe Early capitalism altered rural societyEarly capitalism altered rural society

► Societies became monetary based and not barterSocieties became monetary based and not barter► Improved material standards if grains sold for high profitsImproved material standards if grains sold for high profits

Increased financial independence of rural workers Increased financial independence of rural workers Society would prosper as individuals pursued their own interestsSociety would prosper as individuals pursued their own interests New propertied classes, especially urban middle classes began to appear New propertied classes, especially urban middle classes began to appear

► Capitalism created problemsCapitalism created problems Generated deep social strainsGenerated deep social strains Aristocrats, peasants on fixed incomes, payment of wealth in kind hurtAristocrats, peasants on fixed incomes, payment of wealth in kind hurt Crime associated with wealth, poverty aroseCrime associated with wealth, poverty arose Massive importation of gold, silver led to massive inflationMassive importation of gold, silver led to massive inflation

The nuclear family strengthened by capitalism The nuclear family strengthened by capitalism ► Families more independent economically, socially, and emotionally Families more independent economically, socially, and emotionally ► Love between men and women, parents and children became more important Love between men and women, parents and children became more important

EUROPEAN IMPACTSEUROPEAN IMPACTS► Western EuropeWestern Europe

Commercial impactsCommercial impacts► Beginning of Commercial Revolution, Capital Revolution, Price Beginning of Commercial Revolution, Capital Revolution, Price

RevolutionRevolution► Incredible wealth generatedIncredible wealth generated► Wealth funds European internal developmentWealth funds European internal development► New products, foods importedNew products, foods imported

Diplomatic impactsDiplomatic impacts► European trans-Atlantic empires createdEuropean trans-Atlantic empires created► Colonial rivalriesColonial rivalries► War for coloniesWar for colonies

Social ImpactSocial Impact► Rise of groups with wealth based on money not landRise of groups with wealth based on money not land► Rise of cities, urban groupsRise of cities, urban groups► Commercialization made new products availableCommercialization made new products available► Dependence on agriculture reducedDependence on agriculture reduced

Intellectual ImpactIntellectual Impact► European ideas, religions, philosophies began to spread abroadEuropean ideas, religions, philosophies began to spread abroad► Europeans began to borrow foreign ideas if it suited their needsEuropeans began to borrow foreign ideas if it suited their needs► Contacts with the world challenged traditional European beliefsContacts with the world challenged traditional European beliefs

NEW WORLD ORDERNEW WORLD ORDER► All continents eventually connected by tradeAll continents eventually connected by trade

American silver, foodstuffs spread throughout worldAmerican silver, foodstuffs spread throughout world Terms of trade tend to favor Western Europeans for first Terms of trade tend to favor Western Europeans for first

timetime Commerce generateS wealth which only agriculture had in Commerce generateS wealth which only agriculture had in

pastpast Europeans began to dominate world tradeEuropeans began to dominate world trade Increase of unfree labor systems to support Increase of unfree labor systems to support

commercializationcommercialization► Rise of Atlantic Slave tradeRise of Atlantic Slave trade► Spread of serfdom in RussiaSpread of serfdom in Russia

► Changes in non-European social classesChanges in non-European social classes Non-European landowners in Asia make money from trade, Non-European landowners in Asia make money from trade,

tootoo Muslim merchants largely replaced by European merchantsMuslim merchants largely replaced by European merchants Rise of African slave trading states, kings who made great Rise of African slave trading states, kings who made great

wealthwealth