Global Trade

Definition

Global trade refers to the exchange of goods, services, and capital across international borders, connecting economies and cultures worldwide. It has evolved significantly from early trade routes and practices to a complex system influenced by technological advancements, colonization, and economic policies.

5 Must Know Facts For Your Next Test

1. The period from 1450 to 1750 saw an increase in global trade due to European exploration and colonization, which opened new markets and sources of raw materials.
2. The Columbian Exchange was a key development in global trade, leading to the transfer of plants, animals, and diseases between the Americas and the rest of the world, reshaping diets and economies.
3. Technological innovations in navigation and shipbuilding during this time significantly enhanced maritime trade capabilities, allowing for longer voyages and more efficient trade routes.
4. The rise of maritime empires such as Spain, Portugal, and later Britain and the Netherlands was closely tied to their control over global trade routes and colonies.
5. The Industrial Revolution further transformed global trade by increasing production capacity and demand for raw materials, leading to a more interconnected global economy.

Review Questions

• How did global trade evolve from 1450 to 1750, and what were its main drivers during this period?
  • Global trade evolved significantly between 1450 and 1750 due to European exploration, colonization, and advancements in navigation. The desire for new trade routes to access valuable resources like spices, silk, and precious metals drove nations to explore uncharted territories. This period also witnessed the establishment of maritime empires that dominated international trade through control of key routes and colonies, fostering an increasingly interconnected global economy.
• Analyze the impact of the Columbian Exchange on global trade patterns during the period of European expansion.
  • The Columbian Exchange had a profound impact on global trade patterns as it facilitated the movement of diverse crops, livestock, and diseases between the Old World and the New World. This exchange altered diets worldwide; for instance, the introduction of New World crops like potatoes and maize revolutionized agriculture in Europe and Asia. The resulting population growth further intensified demand for resources, driving global trade expansion as nations sought to capitalize on these new agricultural products.
• Evaluate how technological innovations contributed to changes in global trade dynamics from 1750 to 1900.
  • Technological innovations such as steam power, railroads, and telegraphs dramatically transformed global trade dynamics from 1750 to 1900. These advancements enabled faster transportation of goods over long distances, drastically reducing shipping times and costs. The ability to communicate quickly across great distances also facilitated better coordination in international commerce. As a result, global markets became more interconnected than ever before, leading to increased competition among nations for resources and markets while also contributing to the rise of imperialism as countries sought access to raw materials for their burgeoning industries.

Related terms

Silk Road:

An ancient network of trade routes that connected the East and West, facilitating not only the exchange of goods like silk and spices but also cultural interactions between civilizations.

Mercantilism:

An economic theory and practice prevalent in Europe from the 16th to the 18th century that emphasized the role of the state in managing international trade to increase national wealth and power.

Trade Diasporas: Communities of merchants living outside their homeland who facilitated trade by establishing networks of relationships and economic activity in foreign markets.