The History of Capitalism
Capitalism is based on the same principles as mercantilism. The accumulation of means, materials, land and other things, this accumulation is called capital and “the property-owners of these means of production are called capitalists” (Hooker 2). Productive labor, human work that is necessary to make goods and distribute them, takes the form of wage labor. “The means of production and labor is manipulated by the capitalist using rational calculation in order to realize a profit” (Hooker 2).
Mercantilism is the earliest form of capitalism. Mercantilism can be simply defined as the allotment of trading goods for profit. Rome is credited with the first formation of a mercantile society. As the Rome Empire expanded, mercantilism expanded with it, spreading into the Middle East and Western Europe.
Due the localizing nature of European economies this enabled mercantilism to expand and was not part of the European culture. Thus by the fifteenth century, when the Roman Empire began to retrench so did mercantilism (“Hooker”).
In contrast to Europe, the Arabic economies grew around a thieving mercantilism. They lived on trade routes between three magnificent empires: Egypt, Persia and soon after the Byzantium, and they found that stealing products, then selling them, to be very lucrative. Thieving mercantilism spread swiftly through Spain, Asia, Middle East, and Northern Africa, where “Arabic mercantilism assumed an unprecedented global character” (Hooker 1).
During the Medieval Age is when the European culture expanded its mercantilism, taking trading to lands far beyond its shores. From the 1300’s onwards, the Europeans would push “their mercantile practices” forward, (Hooker 1) causing social upheavals, and catapulting the Europeans into unknown territories (“Hooker”). As Karl Marx pointed out, capitalism started in Europe in the sixteenth century. Between the sixteenth and the eighteenth centuries, feudalism fell apart in Western Europe, and countries emerged as capitalistic society. This unexpected transformation was unavoidable, due to the differences between “the forces of production and the relations of productions in Western Europe’s feudal society” (Kan 9). Great discoveries between the sixteenth and the eighteenth were made (“Kan”) that brought about efficiencies in the production of goods that enhanced the quality of life for mankind as a whole.
The European discoveries created a demand for resources that could not be found on the European continent, or could not be grown in its climate. Their mercantile classes pushed out into the world, and did not shy away from using force to gain the items that could be traded for a profit back in Europe. This bloody development of capitalism led to the discovery of the New Maritime Routes, which Spain and Portugal were the first cultures to exploit. Portugal, Holland, England, Spain, and France each took on comparable roles and joined the colonial plunder....