Topic 1 - Mercantilism

Question 1

Starting point for modern economic development

Answer 1

the renaissance

Question 2

renaissance dates

Answer 2

1300-1700

Question 3

important points of renaissance

Answer 3

focus on humanism, arts, particularly in italy in 14th and 15th century with growing trade between europe and asia

Question 4

renaissance scientific revolution

Answer 4

revolution in discoveries and methods
increased focus on empirical evidence

Question 5

when was printing press developed and by whom

Answer 5

1440 by German Goldsmith Gutenberg

Question 6

Key world discoveries + dates

Answer 6

discovery of new world by columbus - 1492

discovery of east indies by vasco de gama - 1497-99

circumnavigation of globe by Magellan - 1519-1522

Question 7

exploration and discovery - key dates

Answer 7

• First half of 15th Century: Portuguese navigated and charted the West African Coast
• Second half of 15th Century: Portuguese rounded the cape of Good Hope and East Africa onto India
• Following the discovery of the New World, Spanish and Portuguese charted the Atlantic and American East Coast
• 1513: Spaniard, Balboa, discovered the Pacific Ocean by navigating around South America
• 1521-22: Portuguese Magellan circumnavigated the world sailing west-to-east

Question 8

spanish and portuguese conquest

Answer 8

Portuguese in 16th Century: taken control of Indian Ocean, establishing colonies along the West and East African Coasts, in East India, Ceylon, the East Indies, Macao in China and along the Brazilian coast of South America

Spanish: colonised the West Indies Islands, Southern and Central America and the West Coast of South America

Question 9

major imports into europe in 16th century

Answer 9

Spices from the East and Bullion from the Americas

growth in slave trade

Question 10

trade in 17th century

Answer 10

Triangular pattern of trade developed that would go on to form the basis of the British commercial revolution
o Luxuries from the East were mainly traded for bullion; slaves in West Africa purchased with European products were traded for bullion, sugar and other tropical goods from the Americas

Question 11

navigational dominance

Answer 11

first dutch, then england

dutch: took control over Spice Islands of Indonesia with the Dutch East India Company and dominated spice trade with Europe

english: established trading posts in India and the North American colonies and seized islands in the West Indies from the Spanish

Question 12

mercantilism

Answer 12

dominant policy of European powers from late 16th to the 18th century

Question 13

key features of mercantilism

Answer 13

Consisted of strengthening the power of the state afforded by the revenue of expanding trade and colonisation which, in turn, would promote growth

European states sought to increase their government revenue to expand their naval and military capacity to further pursue colonial expansion

Question 14

mercantilism as bullionism - dates and features

Answer 14

16th century

• Believed the essence of national wealth was stock of gold and silver reserves which enable the State to finance military/navy
• Advocated protectionist policies:
  o Prohibit export of specie
  o Exchange rate manipulation
  o Use of barter in foreign trade
• Ultimately failed as specie flowed out to more competitive European nations exporting their products

Question 15

mature mercantilism

Answer 15

17th - 18th century

• Policy objective became accumulating a stock of specie reserves
• Thomas Mun – exemplar of Mercantilism
  o Trade protectionist policies, entirely consistent with colonialism
• Policy Approach: export manufactured products and import raw materials to ensure favourable terms of trade

Question 15

Mun’s mercantilist policies

Answer 15

Summarises the strategic intent of the British Government in 17th and 18th Century
* High import duties except on raw materials which should be uninhibited and removal of any export duties
* Subsidies on manufactured exports
* Forbid export of raw materials
* Money wages low and keep low cost structure for export competitiveness
* Anti-competitive measures such as shipping monopoly (Navigation Act 1651) and granting monopolies to trading companies

Question 16

British and dutch rivalry

Answer 16

• Dutch had superior navy for most of the century, but did not have the resources to expand their colonial possessions other than major trading posts
• Amsterdam was most important financial and trading city in Europe

Question 17

years of anglo-dutch wars

Answer 17

o 1651-1654
o 1665-1667
o 1672-1674

Question 18

how did anglo-dutch conflict end

Answer 18

• Glorious Revolution 1688 ended the conflict with Dutch Sovereign William of Orange placed on the English throne

Question 19

mercantile dominance of Britain in 18C

Answer 19

English Navy was granted many privileges to ensure their loyalty and cooperation to oppose the French
* Any Anglo-Dutch fleet was under English command
* English Navy greatly expanded, but Dutch navy went into relative decline
* Dutch merchant houses began to use London, so it became the centre of merchant trade and finance in Europe

Question 20

commercial revolution in Britain

Answer 20

occurred in 18th century
* Mercantile economy developed significantly laying the foundation for capitalist-based development in the latter part of the century
* Development of constitutional monarchy in 1689 ensured more rational system of taxation

Question 21

significant developments of commercial revolution in Britain

Answer 21

• Better parliamentary government in which a liberal society emerged and public debated of policy thrived with dissenting opinion tolerated
• Creation of Bank of England in 1694
  o Establishment of the funded debt
  o Recoinage of the nations money
  o Emergence of an organised London market for public and private securities
  o Led to lower interest rates for public and private borrowing
• National economic policy heavily influenced by merchant class thorugh parliament
• British naval dominance allowed them to enforce Navigation Acts of 1651 and 1660
  o Promoted the English merchant marine and its maritime trade whose security led them to aggressively pursue foreign markets
• Substantial growth in North American colonies
  o Providing valuable products such as tobacco, rice, indigo and cotton
  o Became markets for English products as population, income and wealth grew

Question 22

when was bank of england created

Answer 22

1694

Question 23

navigation acts years and purpose

Answer 23

1651 and 1660

o Promoted the English merchant marine and its maritime trade whose security led them to aggressively pursue foreign markets

Question 24

first calico act

Answer 24

1701
prohibited the import of printed cotton which quickly stimulated a new domestic industry in printing on imported plain cotton cloth

Question 25

second calico act

Answer 25

1721
was to protect the woollen act and prohibited the display or consumption of imported printed cotton goods

Question 26

when were calico acts repealed

Answer 26

1774

Question 27

dawn of industrial revolution

Answer 27

• Opened the way to a nascent manufacturing industry of textiles and consumer products
• North American colonies became an important source of foreign demand
• Mining and ironworks industries expanded with greater demand for tools by manufacturers and from construction industry