The Commercial Revolution was a period of European economic expansion, colonialism, and mercantilism which lasted from approximately the sixteenth century until the early eighteenth century. Beginning with the Crusades, Europeans rediscovered spices, silks, and other commodities rare in Europe. This development created a new desire for trade, and trade expanded in the second half of the Middle Ages. European nations, through voyages of discovery, were looking for new trade routes in the fifteenth and sixteenth centuries, which allowed the European powers to build vast, new international trade networks. Nations also sought new sources of wealth. To deal with this new-found wealth, new economic theories and practices were created. Because of competing national interest, nations had the desire for increased world power through their colonial empires. The Commercial Revolution is marked by an increase in general commerce, and in the growth of non-manufacturing pursuits, such as banking, insurance, and investing.
Origins of the term
The term itself was coined in the middle of the 20th century, by economic historian RS Lopez, to shift focus away from the English Industrial Revolution.
Voyages of discovery
A combination of factors drove the Age of Discovery. Among these were geopolitical, monetary, and technological factors. The Europeans involved in the Age of Discovery were mainly from Britain, France, the Netherlands, Spain, and Portugal. During this period (1450-1600s), the European economic center shifted from the Islamic Mediterranean to Western Europe (Portugal, Spain, France, the Netherlands, and to some extent England). This shift was caused by the successful circumnavigation of Africa opening up sea-trade with the east: after Portugal's Vasco Da Gama rounded the Cape of Good Hope and landed in Calicut, India, a new path of eastern trade was possible ending the monopoly of the Ottoman Turks and their European allies, the Italian city-states. Following this, Portugal became the controlling state for trade between east and west, followed later by the Dutch city of Antwerp. Direct maritime trade between Europe and China started in the 16th century, after the Portuguese established the settlement of Goa in India, and shortly thereafter that of Macau in southern China. Since the English came late to the transatlantic trade, their commercial revolution was later as well.
In 1453, the Ottoman Turks took over Constantinople, which cut off (or significantly increased the cost of) overland trade routes to the Far East, so alternate routes had to be found. English laws were changed to benefit the navy, but had commercial implications in terms of farming. These laws also contributed to the demise of the Hanseatic League, which traded in northern Europe. Because of the Reconquista, the Spanish had a warrior culture ready to conquer still more people and places, so Spain was perfectly positioned to develop their vast overseas empire. Rivalry between the European powers produced intense competition for the creation of colonial empires, and fueled the rush to sail out of Europe.
The need for silver coinage also had an impact on the desire for expanded exploration as silver and gold were spent for trade to the Middle and Far East. The Europeans had a constant deficit in that silver and gold coin only went one way: out of Europe, spent on the very type of trade that they were now cut off from by the Ottomans. Another issue was that European mines were exhausted of silver and gold ore. What ore remained was too deep to recover, as water would fill the mine, and technology was not sufficiently advanced enough to successfully remove the water to get to the ore.
From the sixth to the eighteenth centuries, Europeans made remarkable inroads in maritime innovations. These innovations enabled them to expand overseas and set up colonies,...