March 13, 2012
1. Financial revolution
- 17-18th c. Fundamental transportation most importantly in England
- 3 main components:
1) Long-term funded national debt: the lit gave government money with long-term
payment plan. A permanent financial plan.
2) Stable and active system for securities ( stock, and bonds) the stock market which
was pioneered in Netherlands
3) A trusted currency to underlie the credit system British pound
- It was an economic and social achievement where people must trust and respect the
contracts. Legal framework developed which were sometimes informal and sometimes legal
- It was necessary to discipline people.
- A culture of financial fear to make them make financial economy seriously. They wanted to
instill confidence in Atlantic trade so kept investing money.
- It enabled Britain to raise money like never before because of the new financial system so
war was more possible and easily funded.
The Bank of England: Founded 1694
- It was used to fight the 9 years war against Louis 14th.
- State’s willingness to be more active with economy. They were motivated to back-up public
- Permanent obligation to maintain confidence in credit economy.
2. Important antecedents to the industrial revolution
The impact of the Industrial Age:
- It was critical to transition to modernity
- What is it? How did it begin?
- Profound changes occurred between 1750 and1915. This was at the expense of the world.
China and India reindustrialized. They used to be accounted for 1/3 of industrial production.
West rose in 1915.
The Agricultural Revolution
- Farmers farmed the same crops annually which drained the lands extensively.
- Small percent made living aside from agriculture and so needed to make it more productive
Major Changes in Agriculture:
1) Introduction of new crops: clover, turnips, and legumes that replenished nutrients and
eliminated the fallow land. Provided surplus of farm animals which made farming easier.
2) Gradual transformation of land use from small family plots to large controlled properties
for commercial. New techniques and technologies introduced as well ( the seed drill for
planting). No longer subsistent farming.