European society underwent a major change during the early modern period with regards to its outlook on wealth and property. Along with that change came the growth of a new kind of state and society, one not only defined by the growth of bureaucracy seen in absolutism, but in the power of the moneyed classes whose wealth was not predicated on owning land. The rise of that class to prominence in certain societies, especially those of the Netherlands and England, accompanied the birth of the most distinctly modern form of economics: capitalism.
- 11.1: Prelude to Trade Empires and Early Capitalism
- In addition, the economic theory of the medieval period posited that there was a finite, limited amount of wealth in the world, and that the only thing that could be done to become wealthier was to get and hold on to more of it. In the medieval and even Renaissance-era mindset, the only forms of wealth were land and bullion (precious metals), and since there is only so much land and so much gold and silver out there, if one society grew richer, by definition every other society grew poorer.
- 11.2: Early Capitalism
- In the seventeenth and eighteenth centuries the first phase of a system that would later be called capitalism: an economic system in which the exchange of commodities for profit generated wealth to be reinvested in the name of still greater profits. Capitalism was (and remains) a combination of two major economic and political phenomena: enterprises run explicitly for profit and a legal framework to protect and encourage the generation of profit.
- 11.3: Overseas Expansion in the Seventeenth and Eighteenth Centuries
- The development of early capitalism was intimately connected with overseas expansion - Europe was an important node of a truly global economy by the seventeenth century, and it was that economy that fueled the development of capitalistic, commercial societies in places like the Netherlands and England. While the original impulse behind overseas expansion during this period was primarily commercial, it was also a major political focus of all of the European powers by the eighteenth century.
- 11.4: The Netherlands
- A simple way to characterize the growth of Dutch commercial power was that the Netherlands replaced northern Italy as the heart of European trade itself after the Renaissance. The Dutch began to look to revenue generated from trade as an economic lifeline. They served both as the middlemen in European commerce, shipping and selling things like timber from Russia, textiles from England, and wine from Germany, and they also increasingly served as Europe’s bankers.
- 11.5: Britain and the Slave Trade
- The slave trade was part of what historians have described as the “triangle trade” between Africa, the Americas, and Europe. Slaves from Africa were shipped to the New World to work on plantations. Raw goods (e.g. sugar, tobacco, cotton, coffee, etc.). were processed and shipped to Europe. Finished and manufactured goods were then shipped to Africa to exchange for slaves. This cycle of exchange grew decade-by-decade over the course of the seventeenth and eighteenth centuries.
- 11.6: Around the Globe
- Even as the British were actively participating in the Slave Trade in the Atlantic region, they began the process of seizing control of territory in India as well. There, they set up self-contained merchant colonies (called factories) run by the English East India Company (EIC), which had a legal monopoly of trade just as its Dutch counterpart did in the Netherlands. The original impetus behind the EIC was profitable trade, not political power per se.
- 11.7: Conclusion
- The greatest changes in world history during the early modern period have to do with the ongoing contact between the different regions of the globe that began with Columbus's (quite literally) misguided voyage in 1492. By the seventeenth century, the peoples of Africa, the Americas, Europe, and Asia were all linked by commerce, trade, politics, slavery, and warfare. Obviously, those contacts would only grow stronger going into the modern period.
Thumbnail: Group of African men, women and children captured and in shackles, are herded by men with whips and guns in order to become slaves. (CC BY 4.0 International; This cropped file comes from Wellcome Images, a website operated by Wellcome Trust, a global charitable foundation based in the United Kingdom. Refer to Wellcome blog pos).