AP European History

## Learning Outcomes

- Understand how **mercantilism** linked colonies to state power in early modern Europe
- Explain why colonies were expected to supply **raw materials** and buy the mother country’s **manufactured goods**
- Identify how colonial labor systems, especially the **Atlantic slave trade**, supported mercantilist empires
- Compare British and French mercantilist practice, including the **Navigation Acts** and **Colbert**
- Analyze how colonial extraction strengthened European states while increasing imperial rivalry
- Use this topic in AP European History causation, comparison, and LEQ or DBQ responses

## AP European History Syllabus

For the AP European History, you are expected to understand how colonies functioned within early modern mercantilist systems, with a focus on the following syllabus points:

- Know that **mercantilism** was a state-directed system aimed at increasing wealth and power through trade regulation
- Identify the role of colonies as suppliers of **raw materials** and as **captive markets** for European manufactured goods
- Explain how a **favorable balance of trade** and **bullion** were central to mercantilist thinking
- Understand how colonial labor often meant **coerced labor**, especially enslaved African labor in plantation economies
- Recognise the importance of the **Navigation Acts** in enforcing English mercantilist control
- Know the role of **chartered companies**, such as the Dutch East India Company, British East India Company, and French East India Company
- Understand how **Jean-Baptiste Colbert** used mercantilist policies to strengthen Louis XIV’s France
- Explain how mercantilism connected overseas empire to state-building and competition among European powers in the seventeenth and eighteenth centuries

## Test Your Knowledge

_Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, look more closely at that area during your revision._

1. What did mercantilist governments want colonies to provide for the mother country?
2. Why were colonies described as **captive markets**?
3. How did the Atlantic slave trade support mercantilist colonial economies?
4. What were the **Navigation Acts**, and why did England use them?
5. How did Colbert’s policies connect French absolutism to overseas trade?

## Introduction

In AP European History Unit 3, mercantilism matters because it shows how economics, empire, and state power worked together. European rulers did not see colonies as separate communities with equal interests. They saw them as tools. Colonies were expected to send wealth-producing materials to Europe, provide labor systems that kept production going, and buy finished goods from the mother country.

This topic connects directly to major AP themes, especially **interaction of Europe and the world**, **poverty and prosperity**, and **states and other institutions of power**. It also works well in causation essays because mercantilism helps explain why European states expanded overseas, fought trade rivals, and tied colonial economies into unequal imperial systems.

> **Key Term: mercantilism**
> An economic system in which governments tried to increase national wealth and state power by regulating trade, protecting domestic industry, and maintaining a favorable balance of trade.

### What colonies were for in mercantilist thought

Mercantilist governments believed wealth was limited. If one state gained more trade and more precious metals, another state would lose out. That assumption shaped colonial policy. Colonies were not mainly valued for settlement or local self-government. They were valued because they could make the mother country richer and stronger.

The basic model was simple:

- colonies supplied **raw materials** and valuable crops
- the mother country processed or sold those goods
- colonies then purchased the mother country’s finished products
- profits and customs revenue strengthened the state

This arrangement aimed to keep wealth moving inside the empire rather than to foreign rivals.

> **Key Term: mother country**
> The European state that controlled a colony and expected the colony to serve its economic interests.
>
> **Key Term: favorable balance of trade**
> A situation in which a country exports more than it imports, so wealth flows into the state rather than out of it.

Mercantilist thinking is often reduced to gold and silver alone, but that is too narrow for the AP exam. Bullion mattered, yet states also cared about manufacturing, shipping, tariffs, and monopoly trade. A colony that supplied sugar, tobacco, timber, or furs could be useful even if it did not itself contain mines.

> **Key Term: bullionism**
> The belief that a state's strength depended heavily on accumulating precious metals, especially gold and silver.

Why did raw materials matter so much? Because European industry depended on inputs it either lacked or could get more cheaply overseas. Sugar from Caribbean plantations, tobacco from the Americas, furs from New France, timber from North America, and later cotton from plantation regions all supported commercial growth. Colonies lowered the need to buy such goods from rival powers.

Colonies also mattered as markets. A mercantilist ruler did not want colonial consumers buying Dutch cloth or French metal goods if they were English subjects, or buying English goods if they were French subjects. That would drain profits away from the empire.

> **Key Term: captive market**
> A market that is forced or heavily restricted to buy from a particular supplier; in mercantilist empires, colonies were often required to trade mainly with the mother country.

This is a distinction students often miss. Colonies were not only places where Europe got things. They were also places where Europe sold things. That second role made the whole system more stable from the imperial point of view. A colony that had to buy metropolitan goods helped sustain domestic manufacturing and merchant profits at home.

> **Test Tip:** In an SAQ or LEQ, do not define mercantilism only as “wanting gold.” Add at least one of these: trade regulation, tariffs, colonial monopoly, captive markets, or state power. That moves your answer from basic recall to stronger analysis.

### Raw materials, plantation labor, and the Atlantic system

The phrase “colonies supplied materials labor markets” can sound awkward in modern English, but the historical point is clear: colonies supplied materials and depended on labor systems that made large-scale production possible. In many cases, that labor was not free wage labor. It was coerced labor.

In the Americas, plantation economies produced export crops on a huge scale. Sugar was the clearest example in the Caribbean. Tobacco was central in parts of British North America. Coffee expanded in some French colonies. Cotton later became crucial. These were not mostly grown for local use. They were grown for Atlantic trade.

The labor demand for plantations was enormous. Indigenous populations had already been devastated in many areas by disease, conquest, and overwork. European powers therefore turned increasingly to enslaved Africans. This was not separate from mercantilism. It was one of the foundations of colonial production.

> **Key Term: Atlantic slave trade**
> The forced transportation of millions of enslaved Africans across the Atlantic from the sixteenth to the nineteenth century to work mainly in plantation and extractive economies.

The common triangular model helps show the pattern:

- European merchants shipped manufactured goods to Africa
- enslaved Africans were transported across the **Middle Passage** to the Americas
- plantation goods and raw materials were shipped to Europe

That model is simplified, but it is useful for revision because it shows the links between European industry, African enslavement, and colonial production.

The key cause-and-effect chain is this:

European demand for colonial goods  
-> growth of plantation economies  
-> greater demand for labor  
-> expansion of the Atlantic slave trade  
-> increased profits for merchants and states

This chain also fed imperial rivalry. Sugar islands, for example, were often more profitable than larger mainland territories. That helps explain why Caribbean colonies mattered so much in European competition.

Students should also avoid a common mistake here: calling this a “labor market” as if workers freely entered wage contracts. In many colonial settings, labor was forced, legally restricted, or violently controlled. That is why **labor systems** is often the better phrase.

British and French examples show this clearly. Britain’s Caribbean and North American colonies exported sugar, tobacco, timber, and later cotton. France drew furs from New France and plantation wealth from Caribbean colonies such as Saint-Domingue, Martinique, and Guadeloupe. In both empires, colonial output supported metropolitan trade and fiscal power.

> **Key Term: plantation economy**
> A colonial economic system based on large estates producing export crops, usually with coerced labor.

### How states enforced mercantilism: Navigation Acts, chartered companies, and Colbert

Mercantilism was not just an idea. It was enforced by law, monopoly, and state-backed institutions. England gives the clearest example through the **Navigation Acts**.

These laws restricted colonial trade so that it benefited England. Goods imported to or exported from English colonies had to move in English or colonial ships, and important colonial products were routed through English ports. The goal was not efficiency for everyone. The goal was imperial advantage for England.

> **Key Term: Navigation Acts**
> English trade laws that restricted colonial trade to English or colonial ships and directed colonial commerce toward England.

The Navigation Acts did several things at once:

- supported English shipping
- reduced foreign, especially Dutch, competition
- ensured customs revenue
- made colonies economically dependent on England

That is classic mercantilism because it joined trade control to state power.

> **Key Term: tariffs**
> Taxes on imports used to protect domestic producers and discourage foreign competition.

Chartered companies were another tool. States granted selected firms monopoly rights over trade in certain regions. These companies were private in form but public in purpose. They advanced imperial goals while spreading risk among investors.

> **Key Term: chartered company**
> A state-backed company granted special trading or colonizing rights, often including monopoly privileges.

The best-known examples are:

- **British East India Company**, founded **1600**
- **Dutch East India Company**, founded **1602**
- **French East India Company**, founded **1664**

The Dutch East India Company was especially successful because the Dutch combined commercial flexibility, shipping strength, and financial innovation. The British East India Company became a major force in Asian trade and later territorial rule. The French East India Company had more limited success.

France under **Jean-Baptiste Colbert** is the classic Unit 3 example of mercantilist policy serving absolutism. As finance minister under **Louis XIV**, Colbert tried to strengthen France by increasing exports, protecting domestic industry, reducing internal trade barriers, and expanding overseas commerce.

He supported the production of luxury manufactures such as glass, ceramics, and textiles. He also worked to develop shipping and colonial trade. Under his influence, France expanded its overseas presence in India, West Africa, the Caribbean, and New France.

> **Key Term: Colbertism**
> The French form of mercantilism associated with Jean-Baptiste Colbert, emphasising state regulation, manufacturing, tariffs, and colonial commerce.

Colbert’s work shows why this topic belongs in Unit 3. Mercantilism was not just about merchants getting rich. It was about monarchy. Louis XIV used economic centralization as part of royal absolutism. A stronger economy meant more revenue, more military capacity, and more independence from domestic rivals.

But there were limits. The French East India Company never matched Dutch or English success. Excessive state control, weaker commercial traditions among elites, and later the immense cost of Louis XIV’s wars all reduced the long-term gains.

This is a strong comparison point for essays:

- **Britain**: stronger enforcement of colonial trade laws, successful maritime commerce, colonies tightly tied to shipping and re-export
- **France**: strong state direction under Colbert, colonial expansion, but weaker long-term commercial performance than Britain or the Dutch
  > **Test Tip:** For comparison questions, do more than list Britain and France separately. Write a direct contrast: “Both Britain and France used colonies to enrich the state, but Britain relied more successfully on maritime trade restrictions such as the Navigation Acts, while France under Colbert used stronger central state direction with mixed results.”

### Why this mattered for European state-building and imperial rivalry

Mercantilism helped European rulers build stronger states. Colonies increased customs income, commercial profits, naval power, and access to strategic goods. Those gains could then support armies, fleets, and administration.

This matters especially in absolutist states. In France, Colbert’s mercantilism strengthened Louis XIV’s monarchy. In Britain, imperial trade and regulation supported a growing fiscal-military state. In the Dutch Republic, commerce and chartered companies underpinned a high standard of living and international influence.

Mercantilism also sharpened rivalry. If colonies were sources of wealth, then rival colonies became threats. That helps explain:

- Anglo-Dutch commercial competition
- French efforts to challenge Dutch and English trade
- repeated colonial and maritime wars
- growing struggles over access to strategic trade routes and markets

The system carried an internal contradiction as well. European states grew wealthier and stronger, but colonial economies remained subordinate. Colonies were expected to serve metropolitan priorities, not develop balanced economies of their own. That uneven relationship became a long-term feature of empire.

This is also where continuity and change comes in. The continuity is subordination: colonies remained economically dependent. The change is scale: Atlantic commerce expanded massively, especially through plantation production and slave labor.

A strong AP argument might say that colonies were not an extra feature of mercantilism. They were central to it. They supplied the materials, labor systems, and markets that made mercantilist empire work.

## Key Point Checklist

_This article has covered the following key knowledge points:_

- Mercantilism was a state-directed economic system aimed at increasing wealth and political power
- Colonies were expected to serve the **mother country**, not develop as equal partners
- Colonies supplied **raw materials** such as sugar, tobacco, furs, timber, and later cotton
- Colonies also acted as **captive markets** for the mother country’s manufactured goods
- Mercantilist governments wanted a **favorable balance of trade** and often valued **bullion**
- Colonial labor systems were often coercive, especially in plantation economies using enslaved Africans
- The **Atlantic slave trade** was central to the production of export crops in the Americas and Caribbean
- The **Navigation Acts** enforced English mercantilist control over colonial shipping and trade
- **Chartered companies** helped states pursue overseas commerce and monopoly trade
- **Jean-Baptiste Colbert** used mercantilist policies to strengthen Louis XIV’s France
- Mercantilism linked colonial expansion directly to European state-building and imperial rivalry
- Britain and France both used colonies for mercantilist purposes, but Britain’s maritime-commercial system proved more effective overall

## Key Terms and Concepts

- mercantilism
- mother country
- favorable balance of trade
- bullionism
- captive market
- Atlantic slave trade
- plantation economy
- Navigation Acts
- tariffs
- chartered company
- Colbertism


Economic Development and Mercantilism - Colonies supplied materials labor markets