THE COLUMBIAN EXCHANGE AND GLOBAL TRADEChapter 4

Section 4

MAIN IDEAS

The colonization of the Americas introduced new items into the Eastern and Western hemispheres.

The global exchange of goods permanently changed Europe, Asia, Africa and the Americas.

INTRODUCTION

The colonization of the Americas prompted both forced and voluntary migration of millions of people.

New and powerful societies were developed.

Colonization resulted in the exchange of new items that greatly influenced the lives of people throughout the world.

New wealth from the Americas led to new business and trade practices in Europe.

THE COLUMBIAN EXCHANGE Global transfer of foods, plants and animals during the

colonization of the Americas. Ships brought back items from the Americas that no one

had seen before. Tomatoes, squash, pineapples, tobacco, turkey… Most importantly, potatoes & corn

Inexpensive & nutritious

TO AMERICA From Europe

Livestock Horses, cattle, sheep and pigs

From Africa Bananas, black-eyed peas, yams

Wheat, rice, barley and oats Disease

GLOBAL TRADENew wealth and growth in

overseas trade led to a wave of new business and trade practices in Europe.

Dramatically changed the economic atmosphere of Europe.

RISE OF CAPITALISM Capitalism – economic system based on private

ownership and the investment of resources, such as money, for profit.

Governments are no longer sole owners of great wealth.

Merchants and traders became wealthy. Result?

Businesses grew and flourished.

INFLATION Increase in economic

activity led to increase in nation’s money supply.

Inflation = steady rise in the price of goods.

Occurs when people have more money to spend and demand more goods and services.

Supply is less than demand = increase in price.

JOINT STOCK COMPANIES Business venture that developed during this period. Works like a modern-day corporation.

Investors buy shares of stock in a company.Number of people combining their wealth for a

common purpose.American colonizationFailed = lost contributionsThrived = shared profitsJSC established Jamestown

THE GROWTH OF MERCANTILISM

Theory – country’s power depended mainly on its wealth.

Countries should do everything possible to acquire more wealth.

Let’s look at page 140…

BALANCE OF TRADE Two ways to increase a

country’s wealth: Obtain as much gold and

silver as possible. Establish a favorable

balance of trade. Sell more goods than

purchased. Basically, become self-

sufficient. Colonies provided gold

& silver. Also, raw materials like

wood and fur.