AP European History

## Learning Outcomes

- Understand how the Commercial Revolution and mercantilism reshaped European politics
- Identify how the Atlantic economy shifted power toward the Dutch Republic and England
- Explain how global trade could strengthen states but also embolden groups that challenged monarchs
- Recall key examples such as Jean-Baptiste Colbert, the Navigation Acts, the Dutch East India Company, and the Bank of Amsterdam
- Analyse how Atlantic commerce contributed to England’s path toward constitutionalism
- Distinguish between mercantilism, the Commercial Revolution, and the Atlantic economy in exam answers

## AP European History Syllabus

For the AP European History, you are expected to understand how expanding global trade and mercantilist policy affected European states and political change, with a focus on the following syllabus points:

- Know that **mercantilism** aimed at a favorable balance of trade, bullion accumulation, and state regulation of commerce
- Identify how the **Commercial Revolution** expanded banking, credit, joint-stock enterprise, and long-distance trade
- Explain how the **Atlantic economy** linked Europe, Africa, and the Americas through trade in goods, silver, and enslaved people
- Understand how the **Price Revolution** changed European economic life through sustained inflation in the 16th and early 17th centuries
- Explain how the Dutch Republic became a major commercial and financial power through shipping, finance, and joint-stock companies
- Understand how England used mercantilist policies such as the **Navigation Acts** and how this connected to parliamentary power
- Analyse how overseas wealth could strengthen absolutist states, but also support constitutionalism in places such as England
- Distinguish careful causation from overstatement: global trade contributed to political upheaval, but did not alone cause every European revolution

## 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 was mercantilism, and why did rulers think it increased state power?
2. How did the Atlantic economy differ from triangular trade?
3. Why did the Dutch Republic become a major commercial power in the 17th century?
4. How did expanding global trade contribute to constitutional change in England?
5. Why is it inaccurate to say that overseas trade alone caused European revolutions?

## Introduction

In AP European History, economic change is rarely just economic. Expanding trade networks changed where wealth came from, who controlled it, and which states could tax, borrow, build navies, and fight wars. That is why a topic that begins with commerce quickly becomes a topic about political power.

This subtopic sits mainly in the early modern period, from the **16th to 18th centuries**, and connects strongly to the AP themes of **Interaction of Europe and the World** and **States and Other Institutions of Power**. The key argument is not that trade mechanically “caused” revolutions everywhere. It is that the global trading network shifted wealth and influence toward some Atlantic powers, especially the Dutch Republic and England, and that this shift helped create conditions for both absolutist competition and constitutional change.

> **Key Term: mercantilism**
> An early modern economic doctrine holding that state power depended on economic strength, especially a favorable balance of trade, bullion accumulation, and government regulation of commerce.

### Mercantilism, the Commercial Revolution, and the Atlantic economy

Students often blur three related but different ideas. Keep them separate.

The **Commercial Revolution** was the broad process. From roughly the **16th to 18th centuries**, Europe saw major expansion in trade, finance, banking, credit, insurance, and investment. This was not a single law or one government policy. It was a large economic shift.

The **Atlantic economy** was one of its most powerful parts. It linked **Europe, Africa, and the Americas** through movement of silver, sugar, tobacco, enslaved Africans, manufactured goods, and later other colonial crops. Africa was central, not optional, because plantation production in the Americas depended heavily on the **transatlantic slave trade**.

Mercantilism, by contrast, was a doctrine and a set of policies. Rulers believed the world’s wealth was limited. If one state gained, another lost. So governments tried to export more than they imported, collect gold and silver, protect home industries with tariffs, and control colonial trade.

> **Key Term: Commercial Revolution**
> The expansion of European trade, finance, and market activity from the 16th to the 18th centuries, including banking, credit, insurance, and joint-stock enterprise.
>
> **Key Term: Atlantic economy**
> The trading system linking Europe, Africa, and the Americas through exchange of goods, silver, cash crops, and enslaved labor.

A common AP mistake is to define the Atlantic economy only as “triangular trade.” Triangular trade is better seen as one pattern within the wider Atlantic system. The wider system included not only Europe-Africa-Americas exchanges, but also bullion flows, consumption changes in Europe, and the rise of Atlantic port cities.

Another crucial economic background factor was the **Price Revolution**. Population growth and the inflow of American silver, especially from mines such as **Potosí**, increased prices across Europe in the **16th and early 17th centuries**. This did not affect everyone equally. Wage earners often suffered because prices rose faster than earnings. Some merchants and landowners could benefit. That matters because economic change produced winners and losers, and those shifts altered politics.

> **Key Term: Price Revolution**
> Sustained inflation in Europe during the 16th and early 17th centuries, driven by population growth and inflows of American silver.

Why did rulers care so much? Because stronger trade meant stronger taxation, stronger borrowing, and stronger war-making. Governments that could channel commerce could finance armies and navies. That is why mercantilism fit so naturally with state-building.

> **Test Tip:** In an SAQ or LEQ, define your terms early. A strong answer might say: “The Commercial Revolution was the broader expansion of trade and finance, while mercantilism was the state policy used to direct that growth for national power.”

### The Dutch Republic and France: two models of commercial power

The Dutch Republic shows how trade, finance, and political structure could make a relatively small state a major power. The Netherlands had a strong merchant fleet, an excellent geographic position, and a leading role in carrying trade between the Baltic and the rest of Europe. Amsterdam replaced Antwerp as a key northern commercial center.

Dutch success was not only about ships. It rested on institutions. The **Bank of Amsterdam**, founded in **1609**, increased available capital and helped make Amsterdam Europe’s financial center. The **Dutch East India Company (VOC)**, founded in **1602**, was a chartered **joint-stock company** funded by both public and private investment. That meant risk and profit could be shared among many investors.

> **Key Term: joint-stock company**
> A business in which investors pool capital and share profits and risks, often used to fund long-distance trade and empire.

This mattered because overseas trade was expensive and dangerous. A single merchant could be ruined by one lost voyage. Joint-stock organization spread the risk and made much larger operations possible. In AP terms, this is a major link between economic development and political power: private capital and state backing worked together.

The Dutch Republic was also politically unusual. It was decentralized, and wealthy merchants had major influence. That helps explain a recurring AP pattern: commercial wealth did not always strengthen monarchy. In the Dutch case, it strengthened merchant elites and representative institutions.

France gives the contrasting model. Under **Louis XIV**, the monarchy tried to use commerce to strengthen royal absolutism. His finance minister **Jean-Baptiste Colbert** is the standard AP example of mercantilism in practice. Colbert promoted manufacturing, especially luxury goods such as glass, ceramics, and textiles. He supported tariffs against foreign imports, tried to remove some internal barriers to trade, and backed French overseas ventures, including the **French East India Company** founded in **1664**.

Colbert’s policies show why mercantilism appealed to absolutist rulers. If the state could direct industry and trade, it could collect more revenue and reduce dependence on foreign rivals. But the French example also shows limits. Strong regulation did not automatically equal strong results. French efforts to rival Dutch and English overseas commerce had mixed success. And however much Colbert improved revenue, **Louis XIV’s wars** consumed enormous resources.

This is an important cause-and-effect chain:

- mercantilist reform increased state revenue potential
- greater revenue supported larger military ambition
- repeated wars drained finances
- heavier taxation deepened social strain

That final point matters because economic policy could strengthen the state in the short term while worsening long-term instability.

### England, Atlantic trade, and the road to constitutionalism

England is the most useful case for the phrase “global network fueled European revolutions,” because here the connection between commerce and constitutional change is clearest. Still, be precise. Atlantic trade did not single-handedly cause the **English Civil War** or the **Glorious Revolution**. Religion, constitutional conflict, and disputes over royal authority were central. But expanding trade changed the balance of power inside the country.

As overseas trade expanded, merchants, financiers, and commercially minded landowners gained importance. These groups were often more interested than the crown in predictable law, secure property, and parliamentary control over taxation. In a commercial society, arbitrary royal finance became harder to tolerate.

The **Navigation Acts** are a classic English mercantilist example. These laws restricted colonial trade to English ships and merchants. They aimed to strengthen English shipping and weaken Dutch commercial competition. Here is the key AP move: the same state that tried to regulate imperial trade also had to settle who possessed the lawful power to tax, borrow, and direct that system.

> **Key Term: Navigation Acts**
> English laws in the 17th century designed to channel colonial trade through English ships and merchants as part of mercantilist policy.

Disputes between the Stuart monarchy and Parliament were deeply political and religious, but they took placeed in an economy where trade and taxation mattered more than before. A monarch trying to raise money without Parliament was not only offending constitutional principle. He was threatening interests tied to an expanding commercial world.

The result was the **English Civil War**, beginning in **1642**, followed later by the **Glorious Revolution of 1688–89**. After 1688, Parliament’s authority over taxation and law was stronger, and the monarchy was limited by constitutional arrangements such as the **English Bill of Rights (1689)**.

This had huge economic results. Parliamentary control over taxation increased trust in the state’s finances. Credit became more secure because lenders had more confidence that taxation and debt management would not rest on royal whim alone. The founding of the **Bank of England in 1694** strengthened this system further.

The wider result was the rise of a powerful **fiscal-military state**:

- Parliament controlled taxation more firmly
- public credit improved
- the government could borrow more reliably
- Britain could fund war and navy expansion more effectively
- Britain could compete more successfully for trade and empire

This is why Britain eventually surpassed the Dutch Republic. The Dutch remained wealthy and important, but Britain combined mercantilist legislation, naval power, Atlantic commerce, and stronger public finance.

> **Test Tip:** For causation questions, avoid single-cause claims. A stronger line is: “Atlantic trade contributed to constitutional change in England by increasing the importance of taxation, finance, and merchant interests, but religion and conflict over royal power were also essential causes.”

### How to use this in AP answers

For AP Euro, this topic rewards students who connect economics to politics with specific evidence. The strongest answers are neither too narrow nor too sweeping.

If an SAQ asks how global trade affected European politics, a good answer might use:

- the Dutch Republic for financial and commercial innovation
- Colbert for mercantilist absolutism in France
- England for trade, taxation, Parliament, and constitutionalism

If an LEQ asks about causation, make the chain explicit. For example:
overseas expansion -> larger trade networks -> more state interest in regulating commerce -> greater dependence on taxation and credit -> conflict over who controls revenue -> constitutional struggles in England

You can also build comparison. France used commerce to strengthen monarchy. England used commerce too, but growing commercial elites and parliamentary power pushed in a more constitutional direction. That contrast is excellent AP evidence.

Be careful with the phrase “global network fueled European revolutions.” In Unit 3 context, the best-supported revolutionary outcome is English constitutional conflict. If you extend the claim to later revolutions, qualify it. Atlantic wealth and colonial systems also contributed to later fiscal and social tensions, especially in France, but you should not suggest a simple direct line without explanation.

A balanced judgment sounds stronger:
global trade strengthened states, but it also changed social power by enriching merchants and financiers; in some places that supported absolutism, while in others, especially England and the Dutch Republic, it helped conditions favoring constitutionalism.

## Key Point Checklist

_This article has covered the following key knowledge points:_

- Mercantilism aimed at a favorable balance of trade, bullion accumulation, and state regulation of commerce
- The Commercial Revolution was the broader expansion of trade, banking, credit, and investment from the 16th to 18th centuries
- The Atlantic economy linked Europe, Africa, and the Americas through goods, silver, and enslaved labor
- The Price Revolution was sustained inflation in the 16th and early 17th centuries, driven by population growth and American silver
- The Dutch Republic became a major commercial power through shipping, finance, the Bank of Amsterdam, and the VOC
- Joint-stock companies allowed investors to share risk and profit in long-distance trade
- Jean-Baptiste Colbert is the leading AP example of mercantilism in an absolutist state
- Mercantilist policy could strengthen states, but war and overextension could still weaken them
- England’s Navigation Acts show mercantilist attempts to channel trade through national shipping
- Expanding commerce increased the political importance of taxation, credit, and merchant interests in England
- The English Civil War and Glorious Revolution must be linked to politics and religion as well as finance and trade
- Parliament’s stronger control after 1688 helped create a fiscal-military state that supported British naval and imperial power

## Key Terms and Concepts

- mercantilism
- Commercial Revolution
- Atlantic economy
- Price Revolution
- joint-stock company
- Navigation Acts


Economic Development and Mercantilism - Global network fueled European revolutions