Economic Perspective on Colonization

US History

European Powers: Imperialism• 1600s Europeans

engage in imperialism—policy of extending a country’s authority over other peoples through – Gaining territory– Establishing

economic and political supremacy.

Mercantilism – Hand-in-hand with Imperialism

• 16th – 18th centuries: Europeans use mercantilism in quest to centralize power.

• What is it? After feudalism, it was a system based on national policies of – Getting gold and silver– Setting up colonies– Establishing merchant marine– Developing industry and mining.– Using colonies as market to sell

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Goal of Mercantilism

• Goal: “favorable balance of trade”– Make sure that nation

exported more than it imported.

– Goods flow out; gold flows in

How do you make Mercantilism work for you?

• Regulate production• Control trading

companies• Restrict imports from

other countries using:– Tariffs: import taxes– Quotas: restrictions on

quantity

• Control raw materials and markets through colonialism.

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Mercantilism and Colonies

• The Mother Country– Mom takes all your raw materials.– Mom forces you to buy all the

goods made in mom’s country.– Mom protects the colony through

“merchant marine”• Keeps out the pirates and privateers

Mercantilism• But is mercantilism “good for business”?

– Years later, Adam Smith in 1776, would say “no” in Wealth of Nations.

– Command systems interfere with free markets.

– Markets free of govt interference are best for a capitalist system, which lets money flow to where it will make more money.

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Labor

• To get all that wealth out of the colonies, the European powers needed cheap labor.– Where did they get it?

3 Types of labor (work)

• Free labor.

• Indentured servitude.

• Slavery.

Indentured Servitude v. Slavery

Indentured Servitude Slavery

Master owned the labor of the servant

Master owned labor and the person.

Lasted for a set number of years.

Owned for the person’s life (unless freed).

Children of indentured servants didn’t USUALLY become indentured.

Children automatically became slaves.

Spanish Empire: Labor• Spanish needed labor for

mining and plantations (sugar).– Spanish colonies could

ONLY trade with Spain.– Plantations needed lots of

workers.– Encomienda system set

up: • Conquistadors given land

with permission to demand labor from Native Americans.

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Spanish Empire: Labor

• Problem: Columbian Exchange brought diseases that wiped out Native Americans.

• Need for labor didn’t go away: Spanish brought slaves from Africa to do the work.

Slavery

• Spanish weren’t the only ones into slavery.– By 1500s Portuguese traded for

slaves with African kingdoms that also employed slavery.

• Need for labor from Africa and need for raw materials from Americas created “triangular trade”: – Followed the sea routes from Africa

to the Americas to Europe

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“Middle Passage”• Middle Passage: Voyage from

Africa to Americas on slave ships.– By 1600 annual exports of slaves

from Africa was 9,500 per year.

– Hundreds crammed onto a single ship.

– Millions of people died along the way through conditions.

– Once they arrived, they worked the plantations.

– Estimate: by 19th century, 11 million Africans sent to Americas.

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Impact of Slavery

• African political structures undermined.– Brain and talent drain

from West Africa.

– Some societies and states disappeared.

– Millions lost their cultures and were forced to assimilate to new cultures.

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Slavery in the English Colonies

• Slavery existed in ALL the English colonies.– Dutch owned slaves in New Netherland;

English continued slavery in New York.– 1638 African slaves came to Massachusetts.– South Carolina settlers from Barbados brought

slaves with them.

In the beginning…

• 1619 first Africans arrived in Virginia, sold to English settlers.– Several were freed after a term of servitude.– Only a few more arrived in the next 40 years.

• 1660 a change: slavery code in Barbados affected other English colonies.– Virginia and Maryland started passing laws

recognizing the existence of slavery status.

Slavery develops

• Not popular in Virginia until 1690s.– Population of 75,000:

• 3000 African slaves• 15,000 European indentured servants• 57,000 free European.

• Massive increase in numbers started in 1700.– 1720-1760 20% of colonial population: African

slaves.

Why Africans?

• Cut off from their homeland.– Easily manipulated and controlled.

• Much more used to agriculture than to hunting..