THE COMMERCIAL REVOLUTION

COMMERCIAL REVOLUTION (late 1300’s – early 1700’s) Definition: period of European economic expansion, colonialism, and mercantilism

COMMERCIAL REVOLUTION (late 1300s – early 1700s) Historical Context: 1. Trade had been dangerous/ expensive 2. Economy was starting to recover 3. Exploration & trade changed Europe’s economy 4.  globalization begins Went hand-in-hand with the Renaissance and the Age of Exploration and Discovery

COMMERCIAL REVOLUTION (late 1300s – early 1700s) Included two competing approaches: A. Free Enterprise – dominated by individuals B. Mercantilism – dominated by monarchs

Characteristics of Free Markets/Free Enterprise: 1. Business owners want to regulate trade to make a profit 2. Industries are privately owned 3. Less developed countries are places to get raw materials & provide a market for business profits 4. Consumer choices drive the market place/what is produced. Characteristics of mercantilism: 1. Manufactured goods are worth more than raw materials 2. Rulers should regulate trade to make a nation self- sufficient 3. Rulers should support industries like shipbuilding 4. Colonies supply raw materials & provide a market for manufactured goods

Staple to the back of your packet. Complete the notes for A FREE ENTERPRISE OR B MERCHANTILISM ------------------------------------------------ Staple to the back of your packet. Discuss with a partner and complete both boxes Complete STEPS 1-4 notes and answer political cartoon questions together. Go over exam review on quizizz.com – 463896 Finish up Unit Assessment map/chart/questions

MERCANTILISM DOCUMENT ANALYSIS Examine the political cartoon. Answer the questions that follow.

Options after taking notes: 1. Unit Exam code = Quizizz.com 463896 2. Renaissance major grade redos: use quizizz.com code ^ to add points to your project grade by Thursday. 3. Finish Unit 7 Assessment: map/chart/questions

A. Free enterprise Definition: private businesses make decisions with little government interference Goal: individuals make money by investing capital and taking risk Encouraged by: individuals Development of joint-stock companies to reduce risk while still sharing in profits

Free enterprise Vocabulary: Entrepreneur: someone takes financial risks in hopes of making high profits Capital: large sums of money to invest in business

A. Once it becomes clear that there is a lot of money to be gained in these foreign lands, the monarchs want to control this trade for themselves.  Mercantilism

B. Mercantilism Merchant Root word: Definition: Economic theory explaining how a nation can become powerful through wealth In what ways would being a wealthy nation make you powerful?

mercantilism Goal: make your country the most powerful by increasing gold and silver Encouraged by: monarchs

mercantilism Vocabulary: Precious metals: gold and silver Raw materials: basic material from which a manufactured good is made

mercantilism Vocabulary: Colony: territory under control of another country Favorable balance of trade: trade deals that benefit you more than your rival

C. BECOMING A RICH AND POWERFUL NATION: MERCANTILISM C. BECOMING A RICH AND POWERFUL NATION: A How-To Guide

Step 1: Export More Than You Import Export = goods sold overseas/ abroad Import = goods bought from overseas/ abroad Goal: have more money coming in than going out = favorable balance of trade

Step 2: Build and Control Colonies Raw Materials Manufactured Goods Goal: become self-sufficient so you don’t have to buy something from another country and lose more gold

-England is the mother country -America is their colony Example: -England is the mother country -America is their colony -France is their rival/enemy 1. England wants gold because wealth = power. 3. America does not have gold, but can produce cotton. 2. England establishes a colony: America. 6. England gets gold and depletes France’s gold reserves. 4. England buys cotton for cheap and does not allow America to produce cloth or trade with any other country. 5. England sells finished cloth to America, and to England’s rival, France.

Step 3: Institute High Tariffs Problem = people are buying goods from other countries Solution = charge them more money in taxes to buy foreign goods Goal: prevent loss of gold to other countries. Remember: to be more powerful you must have more gold!

Step 4: Provide Gov. Support for Commercial Industries Subsidy = money paid by the government to keep the price of a good or service low What was subsidized? Shipbuilding and local industries/manufacturers This means the mother country could sell the products for cheaper and still make a profit, because the cost to make and transport it was lower Goal: promote trade and commerce

MERCANTILISM DOCUMENT ANALYSIS Examine the political cartoon. Answer the questions that follow.