AP European History

## Learning Outcomes

- Understand how **mercantilism** linked state power to colonial empire in the seventeenth and early eighteenth centuries
- Identify how European states used colonies as sources of bullion, raw materials, and captive markets
- Explain the difference between mercantilism, bullionism, colonial extraction, and triangular trade
- Recall major examples, including **Jean-Baptiste Colbert**, the **French East India Company (1664)**, and the **Navigation Acts**
- Compare Spanish silver extraction with British and French commercial and plantation systems
- Analyse how mercantilist colonial policies strengthened states while also creating limits and tensions

## AP European History Syllabus

For the AP European History, you are expected to understand mercantilist colonial extraction in the context of Unit 3, with a focus on the following syllabus points:

- Know that mercantilist principles encouraged European states to extract as much wealth from colonies as possible
- Identify the goal of a **favorable balance of trade** and how it was tied to state-building
- Explain how colonies benefited the **mother country** by supplying raw materials and buying finished goods
- Understand the role of **bullionism** in Spanish imperial policy, especially silver from **Potosí** and **Zacatecas**
- Identify the importance of **Jean-Baptiste Colbert** and French mercantilism under **Louis XIV**
- Know how the **Navigation Acts** regulated colonial trade for England’s benefit
- Understand how plantation extraction in **Brazil** and the **Caribbean** depended on enslaved African labor
- Distinguish colonial extraction from the broader Atlantic systems of triangular trade and the Columbian Exchange

## 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 believe colonies were for?
2. How did Colbert try to make France stronger through economic policy?
3. What is the difference between bullionism and mercantilism?
4. How did the Navigation Acts help England?
5. Name one example of mining extraction and one example of plantation extraction.

## Introduction

In AP European History Unit 3, mercantilism matters because it shows how economic ideas, overseas empire, and state-building worked together in the period from **c. 1648 to c. 1815**. European rulers did not see colonies as equal partners. They saw them as assets to be controlled. Colonies were expected to enrich the mother country by supplying bullion and raw materials, while also buying manufactured goods from Europe.

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 and comparison essays: why states expanded overseas, how they used colonies, and how different empires extracted wealth in different ways.

> **Key Term: mercantilism**
> An economic system in which governments regulated trade to increase the wealth and power of the state, usually by encouraging exports, limiting imports, and controlling colonial commerce.

### The logic of mercantilism: why colonies mattered

Mercantilism began with a simple assumption: wealth and power were closely linked. If a state could accumulate money, especially gold and silver, it could pay soldiers, build navies, wage war, and strengthen royal authority. That is why mercantilism fits so well into Unit 3, the age of absolutism and state competition.

> **Key Term: favorable balance of trade**
> A situation in which a country exports more than it imports, bringing more wealth into the state than leaves it.

States wanted **exports to exceed imports**. That way, wealth flowed in rather than out. But how could governments make that happen? They did not rely on free trade. They used tariffs, monopolies, shipping laws, and colonial restrictions. Colonies became crucial because they made this system easier to enforce.

A colony could help the mother country in two main ways:

- it could send out **raw materials**, plantation crops, or precious metals
- it could serve as a **protected market** for finished goods from Europe

This is the key point students often miss: mercantilism was not just about “getting gold.” It was about creating a whole imperial system that kept wealth circulating inside the empire.

> **Key Term: mother country**
> The European state that controlled a colony and expected the colony to serve its economic interests.

For example, if France could get sugar, furs, or colonial trade through its own empire rather than from foreign rivals, it reduced dependence on outsiders. If England could force colonial tobacco or sugar to pass through English channels, English merchants, shippers, and customs officials all benefited. This helped the state too, because customs revenue and commercial strength supported government power.

> **Key Term: bullionism**
> The belief that a nation’s wealth and strength depended heavily on the accumulation of gold and silver.

Bullionism was part of mercantilism, but not the whole thing. Spain is the clearest case of bullionism because it focused heavily on silver and gold from the Americas. France and England, by contrast, often put more emphasis on regulated trade, manufacturing, and shipping.

> **Test Tip:** In SAQs and LEQs, do not use mercantilism and bullionism as if they mean exactly the same thing. Bullionism is one element of mercantilist thinking, not the full system.

### How states extracted colonial wealth in practice

Mercantilist colonial extraction took several forms. The most obvious was mining. The Spanish empire drew enormous wealth from American silver, especially from **Potosí** in present-day Bolivia and **Zacatecas** in New Spain, present-day Mexico. This silver supported the Spanish crown and fed wider European and global trade.

The Spanish system also shows that extraction depended on labor control, not just ownership of mines. In the Andes, the **mita** drafted Indigenous laborers into mining work. Conditions were brutal, and refining processes exposed workers to deadly substances such as mercury. That means colonial extraction was never just an economic process. It was also a system of coercion.

> **Key Term: mita**
> A forced labor draft used by the Spanish in the Andes, especially for mining, adapted from an earlier Inca labor system.

Spanish America also used the **encomienda**, which gave colonists rights to Indigenous labor or tribute. Students often confuse it with the mita. The easiest distinction is this: encomienda was a grant of labor or tribute to colonists, while mita was a labor draft especially linked to Andean mines.

Another major form of extraction was plantation agriculture. In **Portuguese Brazil** and the **French Caribbean**, colonial wealth came largely from sugar. Sugar was immensely profitable in European markets, but producing it required large-scale labor. As Indigenous populations declined from disease and exploitation, plantation systems relied increasingly on enslaved Africans.

This is why AP Euro expects you to connect mercantilism to the **Atlantic slave trade**. Colonial extraction was not only about policies written in Europe. It depended on forced labor systems in Africa and the Americas. Sugar, tobacco, coffee, and later cotton were part of an Atlantic commercial world in which European states and merchants sought maximum gain.

> **Key Term: plantation extraction**
> The production of cash crops in colonies for export to Europe, usually through coerced labor or enslaved labor.

A third form of extraction was trade monopoly. States wanted colonial goods to move only through imperial channels. That ensured profits, shipping, customs duties, and commercial opportunities stayed in the mother country.

> **Key Term: chartered company**
> A trading company given special rights by the state, often including monopoly privileges in overseas commerce.

Chartered companies mattered because they let governments combine private investment with state direction. They were a useful tool for imperial competition. But they could also become too tightly controlled or fail to attract enough support.

### Colbert, France, and mercantilist state-building

The classic AP Euro example of mercantilism is **Jean-Baptiste Colbert (1619–1683)** under **Louis XIV**. Colbert was the leading architect of French commercial policy and such a central figure that historians sometimes use the term **Colbertism** almost interchangeably with French mercantilism.

Colbert wanted France to surpass the Dutch and the English in trade. He tried to do this in three connected ways:

- promoting domestic manufacturing
- protecting French goods with tariffs
- expanding and controlling colonial trade

The textbook evidence is very specific here. Colbert supported the domestic production of **glass, ceramics, and textiles**. That mattered because under mercantilist logic, a strong state should export valuable finished goods rather than depend on foreign manufactures.

He also backed protective tariffs, including major tariff measures in **1664** and **1667**, to shield French producers from foreign competition. This was not a side issue. It was central to mercantilist thinking: if imports hurt domestic industry, government should step in.

Colbert also tried to make French overseas commerce serve the crown. In **1664**, he helped create the **French East India Company**, giving it monopoly rights in long-distance trade. He wanted France to challenge Dutch commercial dominance in Asia and beyond.

> **Key Term: French East India Company**
> A chartered trading company founded in 1664 under Louis XIV, granted monopoly trading rights as part of Colbert’s mercantilist policy.

French colonies also fit the mercantilist model. They were expected to buy French goods and send useful products back to France. In practice, however, French overseas commerce had limits. The French East India Company achieved only limited success, partly because of excessive state control and limited enthusiasm among French elites for such risky ventures.

This gives you evaluation. Mercantilism could strengthen states, but it did not guarantee success. Colbert could organize policy impressively, yet he could not easily manufacture a commercial culture equal to that of the Dutch.

There was another limit too: war. Colbert’s policies helped build wealth, but **Louis XIV’s** repeated wars consumed it. This is a crucial cause-and-effect chain for essays. Mercantilism sought wealth to strengthen the state; stronger states then often spent that wealth on war; war could drain the treasury and increase pressure on taxation.

> **Test Tip:** If a multiple-choice or SAQ asks why mercantilism mattered to absolutist rulers, connect it directly to armies, navies, taxation, and state authority, not just “trade.”

### England, Spain, and different models of colonial extraction

England used a somewhat different mercantilist system. Its best-known tools were the **Navigation Acts** of the seventeenth century.

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

The **Navigation Act of 1651** targeted Dutch carrying trade by requiring goods imported into England or its colonies to be carried in English ships or ships from the producing country. The **Navigation Act of 1660** tightened control further by requiring most colonial trade to use English or colonial ships and by limiting certain “enumerated goods” to English markets.

This matters because England’s mercantilism was strongly tied to shipping and imperial regulation. Colonies supplied goods such as tobacco and sugar, but they were also prevented from trading freely with foreign rivals. England wanted a colonial monopoly.

By contrast, Spain’s empire remained more strongly linked to bullion extraction. Silver from **Potosí** and **Zacatecas** enriched the crown and helped finance imperial ambitions. But there was a downside. Heavy reliance on silver inflows contributed to the **Price Revolution**, as increasing money supplies pushed prices upward across Europe.

That is an excellent comparison point for AP essays:

- **Spain**: more heavily bullionist, focused on silver mining and coerced Indigenous labor
- **England and France**: more focused on regulated trade, shipping systems, chartered companies, and plantation commodities

This does not mean Spain ignored trade regulation, or that England ignored precious wealth. It means their empires had different centres of gravity.

Students also need to separate **triangular trade** from mercantilism. Triangular trade describes an Atlantic network linking Europe, Africa, and the Americas: manufactured goods out of Europe, enslaved Africans across the Atlantic, plantation crops and other goods back to Europe. Mercantilism is the state policy and logic behind controlling such exchanges.

## Key Point Checklist

_This article has covered the following key knowledge points:_

- Mercantilism linked economic policy to state power in early modern Europe
- A favorable balance of trade meant exporting more than importing
- Colonies were expected to benefit the mother country, not act as equal partners
- Bullionism focused on accumulating gold and silver and was one part of mercantilist thinking
- Spain used silver extraction at Potosí and Zacatecas as a major source of imperial wealth
- Spanish extraction depended heavily on coerced labor systems such as the mita
- Portugal and France used plantation colonies, especially for sugar, with enslaved African labor
- Colbert promoted French mercantilism through manufacturing, tariffs, and chartered companies
- The French East India Company was founded in 1664 as part of Colbert’s programme
- England used the Navigation Acts to channel colonial trade through English shipping and markets
- Mercantilist colonial systems strengthened states but also created inflation, coercion, rivalry, and limits
- Mercantilism, colonial extraction, and triangular trade are related but not identical concepts

## Key Terms and Concepts

- mercantilism
- favorable balance of trade
- mother country
- bullionism
- mita
- plantation extraction
- chartered company
- French East India Company
- Navigation Acts


Economic Development and Mercantilism - States used mercantilist colonial extraction