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Chapter 2 Section III

Chapter 2 Section III. New Patters of Trade. The Columbian Exchange. Transfer of plants, animals, and disease between the Americas and Europe, Asia and Africa. The exchange of goods. Physical difference between Eastern and Western hemisphere's caused plants to develop differently

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Chapter 2 Section III

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  1. Chapter 2 Section III New Patters of Trade

  2. The Columbian Exchange • Transfer of plants, animals, and disease between the Americas and Europe, Asia and Africa

  3. The exchange of goods • Physical difference between Eastern and Western hemisphere's caused plants to develop differently • Europeans had never know foods like • Potatoes, corn, sweet potatoes, turkey • Americas • Rice, coffee, oranges, wheat, sheep, cattle

  4. Introduction of Horses in New World • Previously only llamas were used for manual labor • Horses allowed stronger manual labor by animal • Source of transportation

  5. Effects of Columbian Exchange • Different foods become staple of foods in each others respected diet • Europeans added corn and potatoes • Provided more nutrition • Lived longer • Italy added tomatoes to its recipes • Economy • Texas cattle ranching • Brazilian coffee

  6. Asia and Africa • China received corn • Population boomed! • China’s economy consumed as much silver as possible • Scholars believe that 1/3 of todays food originated from the Americas.

  7. The Introduction of New Diseases • Natives had no natural resistance to European diseases such as: • Small pox • Measles • Influenza • Malaria • Europeans did receive some diseases from Natives but not as deadly

  8. Effects of New Diseases • 1519- Small pox killed an estimate 50% of the Santo Domingo Population • Population of Central America decreased by 30% in 10 years • Inca Empire was 13 million strong in 1492. 2 million in 1600 • North America- 2 million in 1492, 500,000 in 1900 • Intermittent warfare and other violence that also contributed to deaths • Intermittent: occurring at irregular intervals. Not Continuous

  9. Mercantilism • Belief in the benefits of profitable trading • A nations strength depends on its wealth • A wealthy nation had the power to build a strong military to protect itself and expand its influences • Wealth was measured by the amount of gold and silver a nation possessed.

  10. Mercantilism • Mercantilist believed there was a fixed amount of wealth in the world • To become powerful a nation must posses/ take away all other nations wealth • Balance of Trade: The difference in value between what a nation imports and exports over a period of time • Extract gold and silver from mines • Sell more goods than purchased

  11. How to achieve a favorable balance of trade • Reduce the amount of imported goods • Place Tariffs or taxes on those goods • Importer would pay the tariff and price of good goes up • Encourage exports that sell at higher prices • Manufactured goods were more expensive then raw materials • Governments provide subsidies/grant money to help people start new industries

  12. How to achieve a favorable balance of trade 3. Control overseas sources of raw materials and precious metals • A natation that controlled its own resources would not need to import them from foreign countries. • A country did not need to spend any of its own money on raw goods • Foreign countries are rivals • At anytime a rival might become your enemy and cut off your supplies • To prevent this countries become self-sufficient, making colonies where goods are found.

  13. Colonies • Essential to mercantilist • Mercantilist believed colonies only existed to benefit the home country • Mother countries restricted colonies economic activities • People could not sell raw materials to any other nation, or buy manufactured goods from other nations • Colonies count not manufacture goods • This forced colonies to buy from home country

  14. Impact on Society • Colonies impacted European societies because European societies businesses grew. • Merchants become powerful in their towns • New food in old world • Few centuries past before European societies started to grow the new foods discovered in the new world

  15. The Rise of Capitalism • Capitalism: A economic system in which most businesses are privately owned • Merchants would supply colonist with goods from Europe. In exchange merchants brought back raw goods

  16. Rising Prices • Demand for goods increased as population boomed. • Rise in demand = Rise in prices • Money supply in Europe • More money in circulation increases prices

  17. New Business Organizations • Overseas ventures very expensive • Joint-stock companies: Investors buy shares of stock in a company. If there was a profit, the investor would receive a portion based on the share purchased • If company failed, investor lost investment

  18. New Companies • British East India Company • Founded in 1600 • Imported spices from Asia • Virginia Company of London • Founded in 1607 • Established first European colony in North America

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