World Trade

Definition

World trade refers to the exchange of goods and services across international borders, which significantly expanded during the period from 1750 to 1900. This era saw the emergence of global trade networks, facilitated by advancements in transportation and communication, and characterized by increased economic interdependence among nations. The development of colonial empires and industrialization played crucial roles in shaping the patterns of world trade during this time.

5 Must Know Facts For Your Next Test

1. The expansion of world trade during this period was largely fueled by the Industrial Revolution, which created a demand for raw materials and new markets for finished goods.
2. The introduction of steamships and railways greatly enhanced transportation efficiency, reducing travel time for goods and allowing for greater volume in trade.
3. Major commodities traded included textiles, sugar, tobacco, coffee, and opium, with many European powers establishing monopolies over these resources through colonial control.
4. Trade policies began to shift from mercantilism to free trade principles by the end of the 19th century, promoting less government intervention in trade practices.
5. The establishment of global financial markets and institutions, such as banks and stock exchanges, facilitated international trade transactions and investment opportunities.

Review Questions

• How did the Industrial Revolution influence patterns of world trade between 1750 and 1900?
  • The Industrial Revolution drastically transformed world trade by increasing production capabilities in European countries. This shift led to a greater demand for raw materials to fuel factories and new markets for finished goods. As industries grew, nations sought to secure resources through colonial expansion, creating a web of trade relationships that connected multiple regions globally.
• Analyze how colonialism shaped the dynamics of world trade during this period.
  • Colonialism played a pivotal role in shaping world trade by enabling European powers to establish control over vast territories rich in natural resources. Colonizers exploited these resources to feed their industries back home while imposing trade restrictions that benefited their economies. This system not only facilitated the flow of goods from colonies to Europe but also created dependencies that would later impact post-colonial economic relations.
• Evaluate the transition from mercantilism to free trade principles in relation to global economic development during 1750 to 1900.
  • The transition from mercantilism to free trade principles represented a significant shift in economic thought that occurred alongside industrial growth. While mercantilism focused on state control over resources and maximizing national wealth through exports, the rise of free trade advocated for minimal government intervention. This change allowed for more competitive markets and encouraged international cooperation, ultimately enhancing global economic development as countries engaged more freely in trade relationships.

Related terms

Mercantilism:

An economic theory that dominated European thought from the 16th to the 18th century, emphasizing the importance of accumulating wealth through trade surplus and government regulation.

Industrial Revolution:

A period of significant technological and industrial advancement that began in the late 18th century, leading to increased production capacity and the need for raw materials and new markets.

Colonialism:

The practice of acquiring and exploiting territories for economic gain, which was a driving force behind the expansion of world trade as European powers sought new markets for their goods.