Was the historical formation of the capitalist system influenced more by liberalism or mercantilism?

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Capitalism, the economic system based on private ownership, wealth accumulation, and profit motive, can find its roots in the post-colonial mercantilist system of European trade throughout the sixteenth and seventeenth centuries, during the early modern period. Basic elements of capitalism arrived long before that,and have been in place since about...

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Capitalism, the economic system based on private ownership, wealth accumulation, and profit motive, can find its roots in the post-colonial mercantilist system of European trade throughout the sixteenth and seventeenth centuries, during the early modern period. Basic elements of capitalism arrived long before that,and have been in place since about the time that agriculture was introduced, and civilization developed, as a result of the centralization of wealth and capital. For example, monetization and the commodification of natural resources, like grain, was in place before the mercantile system could develop centuries later. The banking system, also a key component of capitalism, was developed earlier during the crusades.

Dutch and English traders deserve most of the credit for developing modern capitalism, creating joint-stock companies for commerce, stock exchanges, commercialization, and speculation on commodities for their growing class of merchants.

As colonial powers, with wealth owned by nations and monarchs, lost their hold over wealthy and powerful traders, such as American revolutionaries, these merchants established the form of capitalism we have today, which is a sophisticated system of global commerce for the benefit of privately-held profit. It is state-sponsored mercantilism, with national and public subsidies supporting private enterprise.

State sponsorship of private gain has been so woven into the current economic system that economic liberalism doesn't figure into the modern global economy and remains hypothetical. A truly “free market,” without interference, has yet to ever be achieved by capitalists.

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