1. What the Enlightenment did for the Economy
New systems of economy
What the Enlightenment did for the Economy

2. New Economy
The ideas of the Enlightenment, along with the Age of Discovery brought about new ideas for economies
People started to realize they could do whatever they wanted, as long as they worked for it
No longer was it born a farmer die a farmer
You could make something of your life

3. Mercantilism
This is a system in which a government controls all economic activity in a country and its colonies to make the government stronger and richer
Was the main economic policy in Europe between
Countries did everything they could to collect more gold and silver
The more colonies a country had, the more money it could make

4. The Columbian Exchange
Was a great example of Mercantilism
The colonies bought food from the old world
The old world would buy food from the colonies
The colonies, being colonies, gave part of their profit to their mother country

6. Capitalism
Economic system in which individuals and private businesses run most industries
Government has little to no control
Based on competition
Food costs started to go down due to technology advances
This means more money to spend elsewhere
People started to buy manufactured goods
The better the product, the more people bought it

7. Cottage Industry and Early Capitalism
The Cottage Industry, as it was in the late 1700s, was an early example of capitalism.
Merchant’s Role in Cottage Industry
Acted as coordinators between buyers and sellers.
Supplied materials – wool and cotton – to cottages to be carded and spun
Took supplies from spinning cottage to weaving cottage to dying cottage, then sold finished cloth at market
Merchants sell product for more than material and labor costs = profit + larger investment = higher profit

8. Cottage Industry Visualized$
Merchant
Merchant
Spinning Cottage
Weaving Cottage $ $
Cotton & Wool Mnfctrs
Merchant $ $
Dying Cottage $
Merchant
Market
Market $
Market $

9. Market Economy
Individuals decide what goods and services they will buy and sell
Our current system
Once again thanks to the Enlightenment people are making the decisions, not the government

10. So What Does All This Mean?
The Enlightenment along with more spending money starts the idea of Capitalism
No longer do the Rich Nobles or Kings decide your job…you do
What you buy is your choice
Our forefathers take these ideas and help develop our current Economy