Columbian Exchange

Columbian Exchange And…

How did it change the World?

• What is the

Discovery of the America’s

• The Columbian Exchange resulted from

the discovery and exploitation of the

America’s in particular, but also due to

European expansion to other parts of the

world.

Impact on Native Americans

• Europeans were learning of the profitability of

the plantation system – relying on what?

– Economic benefit of using local forced labor

• Disease – Europeans, unknowingly brought

measles, mumps, chickenpox, smallpox,

typhus and others.

• The local people had no built-up natural

immunity to these diseases yet.

Impact on Africans

• With decline of native work force, labor was

needed from elsewhere.

• Slave trade exploded, especially in W. Africa

Over the next 300 years (1500-1800) appx

10 million people were taken

Impact on Europeans • Europeans began to cross the Atlantic

creating one of the largest voluntary migrations in world history.

• Overseas expansion inflamed national rivalries in Europe causing conflict.

– Treaty of Tordesillas, 1494 (Spain Vs. Portugal)

• Growth of trade markets completely changed the world.

The introduction of beasts of burden to the Americas was a significant

development from the Columbian Exchange. The introduction of the horse

provided people in the Americas with a new source of labor and transportation.

• Voyages launched large-scale contact between Europe and Americas.

• Interaction with Native Americans led to sweeping cultural changes.

• Contact between the two groups led to the widespread exchange of plants,

animals, and disease—the Columbian Exchange.

• Plants, animals developed in very

different ways in hemispheres

• Europeans—no potatoes, corn,

sweet potatoes, turkeys

• People in Americas—no coffee,

oranges, rice, wheat, sheep, cattle

The Exchange of Goods

The Columbian Exchange

• Arrival of Europeans in Americas

changed all this

• Previously unknown foods taken back

to Europe

• Familiar foods brought to Americas by

colonists

Sharing Discoveries

Different Foods

• Exchange of foods, animals had dramatic impact on later societies

• Over time crops native to Americas became staples in diets of

Europeans

• Foods provided substantial nutrition, helped people live longer

Italian Food Without Tomatoes?

• Until contact with Americas, Europeans had never tried tomatoes

• Most Europeans thought tomatoes poisonous

• By late 1600s, tomatoes had begun to be included in Italian

cookbooks

Economics and Gastronomics

• Activities like Texas cattle ranching, Brazilian coffee growing not

possible without Columbian Exchange; cows, coffee native to Old

World

• Traditional cuisines changed because of Columbian Exchange

Effects of the Columbian Exchange

The Exchange can be positive

or negative in its effects

• In the exchange that started along the coast of

Newfoundland and was made widespread by

Columbus, disease was the most negative for

the Native American population

• Fatality rate over a period of two to three

generations was 95% for many tribal groups

• In some cases, the fatality rate could be 100

percent

Most Europeans believed that it

was God’s will Native

Americans died

• No germ theory at the time of contact.

• Illness in Europe was considered to be the

consequence of sin

• Indians, who were largely “heathen” or

non-Christian were regarded as sinners

thus subject to illness as a punishment

Devastating Impact

• Native American population continued to decline for centuries

• Inca Empire decreased from 13 million in 1492 to 2 million in

1600

• North American population fell from 2 million in 1492 to

500,000 in 1900—but disease not only factor in decrease of

population

• Intermittent warfare, other violence also contributed

The Introduction of New Diseases

• Native Americans had no natural resistance to European diseases

• Smallpox, measles, influenza, malaria killed millions

• Population of central Mexico may have decreased by more than 30

percent in the 10 years following first contact with Europeans

Old World Diseases

• European disease was particularly virulent

• Smallpox, measles, diphtheria, whooping cough, chicken pox, bubonic plague, scarlet fever and influenza were the most common diseases

• Nearly all of the European diseases were communicable by air and touch.

• The pathway of these diseases was invisible to both Indians and Europeans

Effects Widespread

Effects of Columbian Exchange felt not only in Europe, Americas

• China

– Arrival of easy-to-grow, nutritious corn helped population grow tremendously

– Also a main consumer of silver mined in Americas

• Africa

– Two native crops of Americas—corn, peanuts—still among most widely grown

• Scholars estimate one-third of all food crops grown in world are of American origin

• Wealth measured by amount of gold, silver possessed by nation

• Mercantilists believed there was fixed amount of wealth in world

• For one nation to become wealthier, more powerful—had to take wealth, power away from another nation

• Mercantilism led to intense competition between nations

Intense Competition

• Founding of colonies, new goods in Europe led to significant changes

• 1500s, Europeans developed new economic policy, mercantilism

• Nation’s strength depended on its wealth

• Wealthy nation had power for military and expanded influence

New Economic Policy

Mercantilism

• Mercantilists built wealth primarily in two ways —

•extract gold, silver from mines at home, in colonies (Bullionism);

•sell more goods than it bought from foreign countries, creating

favorable balance of trade

• With favorable balance of trade, country received more gold, silver

from other nations than it paid to them

• Increased its power; weakened foreign competitors

• To achieve favorable balance of

trade, could reduce amount of

imports by placing tariffs on

goods

• Importer paid tariff, added cost to

price of good

• Imported goods more expensive,

discouraged people from buying

Imports

• Encourage exports that could sell

for higher prices than raw

materials

• Countries encouraged

manufacturing and export of

manufactured goods

• Governments provided subsidies

to help start new industries

Exports

Balance of Trade

Controlling Sources

Third approach for favorable balance of trade,

Controlling Sources

• Nation that controlled their own sources would not need to import from competing nations

• Why important

– Country did not need to spend own money to obtain raw materials

– Foreign countries considered rivals, might become active enemy, cut off supply of raw materials

• European nations worked to become more self-sufficient

• Nations began to establish colonies

Building colonial empires essential to mercantilist system

• European powers wanted to

establish colonies

– To control sources of raw

materials

– To provide new markets for

manufactured goods

• To mercantilist, colonies existed

only to benefit home country

Colonies

• Monarchs restricted economic

activities in colonies

• Colonists could not sell raw

materials to other countries

• Could not buy manufactured

goods from other nations

• Strict laws forbade colonies from

manufacturing goods

• Forced to buy only from home

country

Strict Laws

Colonies

Summarize

What were the main principles of

mercantilism?

Answer:

•nation's strength depended upon its wealth;

•needed a favorable balance of trade

Commercial Revolution

• What: The transition (change) from Mercantilism & then to Capitalism is referred to as the

COMMERCIAL REVOLUTION

• When: 16th -17th centuries

• Who/Where: Europeans & European countries & colonies

• Why?: changes in commerce (trade) & money making methods

Changes in the power structure between countries

• Why Care?:Influenced today’s financial dealings (the way we do business)

Commercial Revolution

• CAUSE:

– new wealth + dramatic growth in overseas trade

= new business and trade practices

• EFFECTS:

– set the stage for the development of CAPITALISM

– Basis of today’s financial practices

New Ventures

• Overseas business ventures often

too expensive for individual

investors

• Investors began pooling money in

joint-stock companies

Shares

• Profit, loss based on number of

shares owned

• If company failed, investors lost

only amount invested

Joint-Stock Companies

• Investors bought shares of stock

in company

• If company made profit, each

shareholder received portion

Financing Colonies

• British East India Company, one of

first joint-stock companies

• 1600, imported spices from Asia

• Others formed to bear cost of

establishing colonies

New Business Organizations

Increasing trade between Europe and colonies created new business and

trade practices during the 1500s and 1600s. These practices would have a

great impact on the economies of European nations.

• In capitalism, most

economic activity

carried on by private

individuals,

organizations in order

to seek profit

• During this time,

capitalism expanded

Capitalism Emerges

• Individuals amassed

great trade fortunes

• Merchants supplied

colonists with

European goods

• Returned products,

raw materials

Overseas TRADE

• Overseas trade made

many merchants rich

• Wealth enabled them

to invest in more

business ventures

• Business activity in

Europe increased

greatly

Increased

BUSINESS ACTIVITY

The Rise of Capitalism

So… What is CAPITALISM • Economic System based on:

– private ownership &

– investment of wealth

– maximization of profit

– Free Trade

• Cause: overseas colonization & trade = lots of merchants became rich.

– And… they continued to invest in trade to get richer (increase profits)

– AND then… they re-invested more to get even more profit.

Mercantilism was not a Free Market Economic System

• Generally, a society is capitalist if:

1.) The means of production are privately owned and operated for

profit.

2.) Money is used instead of barter

3.) There is a free labor market

4.) Decisions regarding investment are made privately

5.) Production and distribution is primarily controlled by companies

each acting in their own interest

• The Merchants system which operated under the Columbian

Exchange was not truly capitalist as many decisions were made by

governments and not by private industry and much of the labour

used was slave based and not free market. Additionally, self

sufficiency was the goal, not finding the lowest cost alternative and

the maximization of profits.