European Economic Systems 1500-1900

Mercantilism, Capitalism & Socialism

Directions:

1. Use the LAHS databases
1. Go to LAHS's Library Page
2. Click on Research
3. Use passcode: laeagles
4. search: mercantilism & europe
2. Read & fill out the next 4 slides as best you can in 10 minutes
3. Discuss: your content 5 minutes
4. Share w/the class 5 minutes
5. Repeat for Capitalism & Socialism w/slight reading variations

Mercantilism

Mercantilism Definition

• nation's economy tinkered with to improve
• monopolies created
• government want to control economy
• wealth into the king's coffers
• economic system that dominated Western Europe from around 1500 to the time of the Industrial Revolution
• politically planned economy
• income taken by rulers to be sent to the ruler for them to figure out how to use it

Mercantilism People & Places

• "that there is an irreconcilable conflict of interests among men and groups of men," wrote Ludwig von Mises in Theory and History
• colonies were viewed as economic markets whose purpose was to serve the mother country
• jean baptiste colbert, main pusher of mercantilism
• louis xiv helped him

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Mercantilism: Why it Failed

• monopolies became dangerous
• "distorted" version of "natural" commercial system
• taxes were repealed or reduced as the middle class began to exert its growing power
• based off of old methods, therefore old mistakes
• adam smith introduced capitalism, which the people were very interested in

Capitalism

Read me please!!!

Capitalism Definition

• laissez faire
• no government interference
• market dictates success
• obscene amounts of wealth to some
• imbalance of distribution of wealth

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Capitalism: People & Places

• Adam Smith
• government shouldn't be controlling the economy
• govt should allow people to determine what they want to do for themselves
• laissez faire
• market will dictate success
• America "subscribes" to Smith
• made Britain the economic colossus of the world, gave her supremacy on the seas for some 150 years

Capitalism: Why it replaces Mercantilism

• obscene wealth to a few, everyone else impoverished
• cheap cloth for all
• overall lifting
• vladimir, karl marx "The Communist Manifesto"
• no utopia
• no happy place
• everybody sad
• die

Communism

Read Me Please!!!

Communism Definition

• government takes all wealth, redistributes to people
• Karl Marx
• everything is a government monopoly
• disgruntled employees
• perverse incentives to sabotage total control

Communism People & Places

• Karl Marx
• people angered
• not happy working in factories
• each according to his needs, each according to his wants
• bodies are not communal properties
• women get the right to vote 5 years before in communist countries

Communism: Response to Capitalism

• government controls everyone and everything
• arises as a response to wealth divides
• proletariats (working urban poor) and aristocrats are most opposed
• bourgeoisie are for it

Socialism

Research using the database again please!

Socialism: Definition

• pay proportional to work done in job
• You have two cows. The government takes one and gives it to your neighbor

Socialism: People & Places

• robert owen, john stuart mill (utilitarian)
• try to maximize people's happiness
• by wealth, rendering services

Socialism: A response to Capitalism & Communism

• blending of the two systems