1. The Growth of the Cottage Industry & Building the Atlantic Economy
Mater Academy High School
AP European History
Chapter 17 – The Expansion of Europe in the 18th Century
Section 3 – The Growth of the Cottage Industry
Section 4 – Building the Atlantic Economy
McKay, et al., 8th edition

2. Essential Questions
Why were the fundamental economic factors of European society beginning to change, and what were the dimensions of these changes?
How did these changes affect people and their work?
How did these changes foreshadow the upcoming Industrial Revolution and which countries take the lead?

3. The Putting-Out System

4. Shortcomings of the Putting-Out System
The production in the countryside is unregulated (no guild standards) which leads to inconsistent quality.
Inability to enforce quotas.
Disputes with workers over weights of materials delivered.
Difficulty making workers produce steadily.

5. Characteristics of the Putting-Out System
Peasant communities had always made some clothing, processed some food, and constructed some housing for their own use.
By the eighteenth century the pressures of rural poverty required peasants to search for ways to supplement their way of life.
The putting-out system (rural industry) is utilized to supplement income and is an opportunity for merchant capitalists.
The putting-out system employs rural families.

6. Building the Atlantic Economy
Mercantilism and Colonial Wars
English mercantilism was characterized by government regulations that served the interests both of the state and of private individuals.
Mercantilism in other European countries generally served only state interests.

7. Mercantilism and Colonial Wars
The Navigation Acts of 16511663 were a form of economic warfare against Dutch domination of Atlantic shipping. They gave British merchants and ship owners a near monopoly on trade with Britain’s North American colonies.
After defeating the Dutch, England fought a series of wars with France for maritime domination of the world.
War of the Spanish Succession (17011713)
War of the Austrian Succession (17401748)
The Seven Years’ War (17561763) ended with British winning full control over India and North America.
American colonists referred to this as the French and Indian War

8. Land & Labor in British America
In Britain’s North American colonies cheap land and scarce labor resulted in the following:
rapid increase in the colonial population in the eighteenth century.
import of African slaves to tobacco plantations in southern colonies.
growing prosperity for British colonists.

9. The Atlantic Economy (18th century)
Britain and especially England profited from the mercantile system.
As trade with Europe stagnated, colonial markets took up the slack.
English exports grew more balanced and diverse.

10. The Atlantic Slave Trade
The forced migration of millions of Africans was a key element in the Atlantic system and western European economic expansion.
After 1700, Britain was the undisputed leader of the slave trade.
Increasing demand led to rising prices for African slaves.
Africans participated in the trade.
After 1775, a campaign to abolish slavery developed in Britain.

11. Revival in Colonial Latin America
Under Philip V (r. 17001746) Spain recovered economically and successfully defended her American colonies.
Rising silver exports in the eighteenth century helped create a class of wealthy Creole (Spanish blood born in America) merchants.
Creole estate owners dominated much of the peasant population through debt peonage, really a form of serfdom.

12. Adam Smith and Economic Liberalism
Smith challenged mercantilist ideas with his defense of free trade and his argument for keeping government interference in the economy to a minimum (The Wealth of Nations [1776]).
Smith was one of the Enlightenment’s most original thinkers.
His work became the basis of the classic argument for economic liberalism and unregulated capitalism.
Smith argued that government has “only three duties”
Defense of the country
Civil order within the country
Sponsor indispensable public works and institutions

13. Questions to check your understanding
What were the factors surrounding the English Navigation Acts? How did they help British merchants?
How does the French government try to improve living standards for the rural poor?
What are the shortcomings of the putting-out system?
Who worked the plantations in Virginia?
Who was employed by the putting-out system?
Who led the Spanish revitalization in Spain in the eighteenth century?
Who were the Mestizos? Who were the Creole?
What was the decisive round in the colonial conflict between England and France?
Why do the British win the American component of the Seven Years’ War – what decision helped turn the tables?
How does Spain recover after 1700?
Who was Adam Smith? What is his most famous work and what argument does he make in this written work?
By the 1770s, who experiences the largest trade increase with the British?