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History of the world economy

Feudalism to mrechant capitalism in the 13th century

European world syste, 16 - 27th c 

Proto-industrialisation of the 18th c industrial revolution 

Before 12th century there were well developed eco worlds 

eg Mediteranean region, chinese empire, land mass from russia to monglia, INdian ocean/red sea complex and maybe the baltic sea

Why didn't the chinese expand despite being more powerful?

China failed to pursue econoic oppourtunities overseas because they were more focused on their own world - nowhere else mattered 

Also preoccupied with the mongols and/or japanese pirates. 

Centralised power strucure of imperial China x have enough interest groups who wanted sea exploration

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Feudalism to Merchant Capitalism

Agreed that the overall context for transition was a phase of

eco, demo and pol crisis caused by

 steady pop growth tech improvements and limited amounts of usuable lands

Feudal system disintegrated and was replaced by an economy dominated by market exchange

Communities would specialise in one thing they could produce more efficiently than other communities 

Merchants supplied capital required to initiate the flow of trade

MC was self-propelling growth system where continued expansion of trade was vital 

Without trade merchants or producers etc could maintain their position

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Merchant Capitalism

Regional specialisation of good was down to the longstanding patterns developed by traders from Venice, Florence, Genoa etc from the 12th century

Bc it is self-propelling centres of trade multiplied and a complex system emerged which focused mostly on bulky staples not luxury goods

All the trade increased urban development - merchants settled at locations of significance  eg major trade routes 

Ket to urban growth was a process of import substitution - externally produced **** would produce locally produced **** 

Many imported manufacturers could be copied by local producers = increasing local oppourtunities + increasing the amount of local capital investment available 

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Consolidation and expansion 15-16th c

1. Innovations in business and tech consolidated MC eg organising business and finance (loans, banking systems etc). Helped ind,agr and commerce but also encouraged savings and helped their use for investment

Brought about routinization of commercial and financial property rights 

2. Adaptions from other states led to jealousy by the centers of innovation

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Mercantilism and territorial expansion

Self-p growth could only be sustained as long as productivity could be improved = required food and energy resources fromnew territories. Needed gold and silver through the trade with China, Arabia and Byzantium

Basis of M was that national wealth was to be measured ito the ammount of precious metal+ source of eco growth was a balnce of trade. This justified colonization and the age of discovery

There was high gov regulation in that people domestically were encouraged to save to accumulate capital for overseas investment. Europeans were stronger at sea than on land - hence why they avoided going eEast - but destroyed muslim shipping trade in the Indian ocean and captured intra-Asian trade

Gold and silver in the Americas - converted into demand for consumer goods= stimulating production among the economic system. Also new goods which created new markets for merchants

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Result of territorial expansion

As european traders monopolised intra-oriental trade routes the were able to control the flow and patterns of trade between potential rivals 

They got new lands, opps of import substitution, business techniques etc

Profits from overseas colonies overflowed into agriculrture, mining and manufacturing

this capital was one of the preconditions for the emergence of industrial cap in the 18th c

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1. Emergence of a true world economy inc long distant interaction based on spatial division of labour

2. Progressive elaboration of the world economy with competitive markets creating more and more uneven unveven commodities

3. The pattern of specialisation and nature of eco interaction created core areas characterised by mass markets and peripheral areas characterised by monoculture of cash crops .

Semi were characterised by a process of deindustrialisation but retaining a share of ind production and fin control

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