2.3.5 Capitalism
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2.3.5 The Rise of Capitalism
Why did imperialism occur?
To move ahead as a nation, a country must have a system in place to support its development. The economic system that arose during the Industrial Revolution and encouraged economic expansion into other lands through imperialism was the system of
capitalism.
Capitalism is the main economic system in the world today. It encourages people to work hard, compete, and produce a good product to become wealthy.
Mercantilism: In the early days of imperialism, Britain used an economic system called mercantilism whereby governments sold their products to other nations while discouraging people from buying products from outside the country. To discourage buying outside products, they charged tariffs (taxes) on anything imported. This is called protectionism.
The free enterprise economy: According to the great thinkers of the day, land and agricultural production were the source of all real wealth. Basically, the more land a person owned, the more he could produce. The more the person could produce, the more could be sold. The more he or she sold, the more profit was made. They believed that people should be free to make their own economic decisions without government interference.
In theory, this free market would result in an increase in trade and greater wealth for all. You will learn more about capitalism in the next two units.
Capitalism is the main economic system in the world today. It encourages people to work hard, compete, and produce a good product to become wealthy.
Mercantilism: In the early days of imperialism, Britain used an economic system called mercantilism whereby governments sold their products to other nations while discouraging people from buying products from outside the country. To discourage buying outside products, they charged tariffs (taxes) on anything imported. This is called protectionism.
The free enterprise economy: According to the great thinkers of the day, land and agricultural production were the source of all real wealth. Basically, the more land a person owned, the more he could produce. The more the person could produce, the more could be sold. The more he or she sold, the more profit was made. They believed that people should be free to make their own economic decisions without government interference.
In theory, this free market would result in an increase in trade and greater wealth for all. You will learn more about capitalism in the next two units.
Early capitalism
Although the economic system of capitalism became popular during the Industrial Revolution, perspectives vary on how much it benefited the average person.
Consider the image. It was published in a workers' magazine.
From the view of this artist...
The views expressed in this image illustrate some common concerns with capitalism.
Some people benefit more than others. Those who start with money tend to get richer, but the poor do not have the same advantages. The rich are supported by the majority of people who do most of the work.
Capitalism, Imperialism, and International Trade: The free market economy encouraged capitalists to obtain natural resources and labourers as cheaply as possible and to find new markets in which to sell their goods. Because of technological developments, capitalists were able to use ships to travel to other parts of the world where they could obtain raw materials such as lumber and cotton very cheaply. They were able to use cheap labour by hiring or enslaving people in Asia, Africa, and the Americas.
Although the economic system of capitalism became popular during the Industrial Revolution, perspectives vary on how much it benefited the average person.
Consider the image. It was published in a workers' magazine.
From the view of this artist...
- What is the opinion about capitalism of the average person?
- Who benefits?
- Who does all the work?
- Who suffers?
The views expressed in this image illustrate some common concerns with capitalism.
Some people benefit more than others. Those who start with money tend to get richer, but the poor do not have the same advantages. The rich are supported by the majority of people who do most of the work.
Capitalism, Imperialism, and International Trade: The free market economy encouraged capitalists to obtain natural resources and labourers as cheaply as possible and to find new markets in which to sell their goods. Because of technological developments, capitalists were able to use ships to travel to other parts of the world where they could obtain raw materials such as lumber and cotton very cheaply. They were able to use cheap labour by hiring or enslaving people in Asia, Africa, and the Americas.