Commercial Revolution:Combination of Capitalism and Mercantilism
The goal of capitalism was a business system that made individuals wealthy. That is a system that was designed to reward the individual, so it encourages risk-taking. In contrast, mercantilism emphasized direct government intervention in economic policy to increase the general prosperity of the state. That is, one of its main goals is a system that would make the state powerful. Although the both were distinct until the end, the both systems continued to work together until the early-modern period. Indeed, governments and entrepreneurs designed new institutions of this type that facilitated the expansion of global trade during the fourteenth and eighteenth centuries, which has been called the Commercial Revolution.
Causes of the Commercial Revolution
After analyzing all the situations, the following reasons can be called responsible for this revolution-
1. Crusade—
The Crusades gave impetus to international trade. Because when the people of western European countries went to the eastern countries to participate in the Crusades, they got information about sugar, spices, silk clothes, precious gems etc. which they brought home with them while returning. Hence the demand for these goods increased in European countries. Italian cities got more commercial benefits from this and the way of Mediterranean trade was opened for Western European traders. This increased the contact of the merchants of Western Europe with the merchants of the eastern countries and increased the intensity of business activities, which contributed significantly to the development of commercial revolution.
2. Renaissance -
As a result of renaissance there was communication of new consciousness. Man started leaning towards materialism in place of otherworldly life. Man could dare to oppose superstitions, difficulties and traditions. As a result, the aspiration towards material life started increasing which had a direct impact on the economy. Therefore, serious efforts were started gradually to get physical resources, which soon started the process of widespread economic change.
3. Protestant ethics -
In the Middle Ages, the Church propounded the superiority of spiritual life, describing life as a futility. Material pleasures were propounded as thorns to the spiritual life, but Protestants idealized the betterment of not only the spiritual world but also the material world, which contributed to the removal of obstacles in the path of capitalism. As Max Weber has shown - Protestants made special contribution on thrift, importance of time and labor and process of taking interest. Therefore, the feeling of adding personal property started gaining momentum in the general public.
4. Economic condition -
Economic conditions were also no less responsible for the rise of mercantilism. With the circulation of money, there was widespread in the field of trade and commerce. In addition to the local requirement, now the need for more production in the producing countries got strengthened. The development of new mines and banks encouraged foreign trade. Now every country started competing to get gold and silver. A new environment was born after gold and silver deposits were discovered in many parts of America.
5. Political situation –
Machiavelli in his book 'The Prince' considered the power of the king as paramount and made it clear that other powers should also bow under the power of the king. In the words of Alexander Gray, "Machiavelli gave politics an independent character apart from all morality." Undoubtedly, the paramountcy of the state was being emphasized. In fact, the root cause of this was the internal situation and the threat of external attacks. The internal situation had become chaotic. The economic condition of the entire public had become very pathetic. It had become difficult to bear the expenses of a powerful army from agriculture and domestic economy. On the other hand, the mercantilists were emphasizing on the fact that the state treasury can be increased through trade, so the kings also encouraged the discovery of new countries and foreign trade.
6. Hanseatic League-
Many cities of Northern Europe and Germany formed a union for trade which was called 'Hanseatic League'. Although the initiative for its formation was taken in the 12th century, but this League took its real form in the 14th century. After this, it played an important role in the trade of Northern Europe till the second half of the 16th century. In the peak period of this union, it included sixty to eighty cities. Trading centers and warehouses were established in these cities, where grain, fish, leather, wool, timber, iron, copper, lac, asphalt, etc. were sold by the merchants involved in the Hanseatic League.
7. Travelogue of Marco Polo-
Marco Polo's travelogue also proved to be a contributing factor in this revolution. Marco Polo traveled to China and other eastern countries in the 13th century and after returning home he published his travelogue. In this, he described the splendor of Eastern countries and the sugar, cotton, spices, gold-silver, precious gems, etc. found there, due to which the western Europeans got attracted to the products of the Far East.
8. Sea voyages—
If there were no sea voyages that started in the 15th century, probably this commercial revolution would not have been so successful and widespread. The ambition of Spain and Portugal to establish trade relations with the eastern countries inspired them to make adventurous voyages in the ocean.
9. Contribution of thinkers-
Sir Thomas Man of England wrote a book named 'England Treasure by Foreign Trade' in 1664. This book is famous by the name of 'Bible of Commerce'. According to Thomas Man, "The policy of minimum import and maximum export should be adopted for the increase of our prosperity." Antonio Serra was born in Italy in 1580 AD. He emphasized the principles of mercantilism in his book. According to Serra, "Due to the uncertainty of the weather in agriculture, the profit remains uncertain whereas in industries only the rule of growth is applicable. Therefore, emphasis should be laid on the policy of growth of industries." Jean Baptiste Colbert was the finance minister of France. According to Colbert, “The domestic economy can be strengthened by building roads and canals. The building of a powerful shipping fleet, restrictions on the export of grain, state control over guilds, establishment of trading companies, encouragement of industries for colonial expansion and creation of currency are absolutely necessary for mercantilism or for the development of a country."
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