COMMERCIAL REVOLUTION- A DRASTIC CHANGE IN WORLD ECONOMY

The Globalizing World: An Overview of the Commercial Revolution in Europe from the Late 13th to 18th Centuries

Mid 15th century has started experiencing changes in the economy. It might have started with slow pace but integrated in a huge economic transition and after the 16th century it spread widely over Europe. While it seems that these are just random affairs in the past, they are planned economic and political growth. Portugal, Holland, and England, Spain (western europe) were involved in these type of revolution. Although, these are not just revolution limited to european countries. They are industrial revolution which leads to commercial revolution, beginging of modern banking system,political revolution, drastic visible changes in economic and social stage which we can also call the economic and social revolutions. Commercial revolution began with trading and but ends with remarkable impact just not on european history but also to entire world.

Where it all started-

During ancient times, people were limited by the boundaries of sea and mountains. But till the medieval period people starting exploring and inventing things to ease their lifes. By the end of medieval period human learns the existing of other countries and tried to explore them.

Vasco da Gama’s Voyage, Christopher Columbus began his journey in search of species, places, and cultures that include different textiles and places that can provide the necessities at the lowest price and are of good quality. So when these people discover the banks of the Indian Ocean or countries like India and China, they have turned up the greatest fortune to trade these discoveries. Before Christopher Columbus or Vasco Da Gama found the route from the Atlantic Ocean to the Indian Ocean, there was already a short route to the Indian Ocean, from the Atlantic through the Mediterranean Sea, which we all knew as the Seuz Canal.

   Although these are not so easy task, the routes were of considerable length to reach India or China. The east already has a monopoly with Italy, so for Europe, the trade is difficult because of the high trade price asked by the east, and the known trade route, which is from the Suez Canal, has been heavily tolled. That’s when the first European, Vasco da Gama’s Voyage, and Christopher Columbus came with the route to India and China. 

But soon America got discovered along with it  African parts along with Malacca were  taken over.  the Spice Islands of West Indies, and South America were also among them. Trade  grew into a global business. During in between all this, Italy lost their monopoly with the east. 

The companies who all started the trade commerce claim themselves a private company and known as a joint-stock company. Joint stock company is a private company rather than a government sponsored company where investors bought shares in the company. And also share the risk of Dutch East India Company. Which results in the company running independently without the interference of the government. Only shareholders and companies share their risks and rewards among themselves. 

After all these the Dutch have gained much more than just the profits. And guess who need to handle all this economic money. Exactly! A  bank. The bank of Manchester was established at the beginning of the 17th century. Which handles all the economic money that was brought under by trading from diffrent contries. 

NEED OF BANKS-

Have you ever thought before any bank was introduced how trading or any business would take place. The trading system which existed way before banks were known as barter systems.

BARTER SYSTEM-

Let’s understand the barter system with a simple example. Imagine a country named A and another country named B. Country A grows rice, and Country A wants to buy that rice. So for common sense, we know they need to pay the price to buy some or X amount of rice from country A. Country B grows wheat and tomatoes, so in exchange for rice, they trade some Y and Z amounts of tomatoes and/or wheat in return for rice. So this system of exchanging goods is known as the barter system. 

But have you thought about what happens when the country does not want either tomatoes or wheat. Then obviously the trade will not take place. This is where economy and capatalism come forward. To overcome all these issues, European countries come with a money economy.

  This was the 16th century when European countries were evolving rapidly. They are evolving in terms of scientific temper ex- Galileo di Vincenzo Bonaiuti de’ Galilei. He was an Italian physicist and engineer, also an astronomer. Along with scientific temper, people of Europe have developed different tastes in textiles, foods, languages and also travel. As a result, trade has increased. Flow of money increased. This is the exact reason why banks were introduced. 

Around 1609 the bank of Amsterdam was established. Today we can count the number of banks just around 5 minutes away. But then the establishment of the bank was the big step toward modern world or we can say modernisation. So this is why the bank was introduced. To manage the money that comes in and goes out during the trade. And then slowly banks became one of the important parts of trading and commercializing the economy of their country.

So what you think is all this? These are not just a few trading systems or changes in the economy. Because these changes are not limited to Europe, the connection of change has set its web throughout the world. So we can say that this commercialization was globalized by the end of the 19th century. This includes the countries from the east to the north.

               This is what we know as the Commercial Revolution.

ECONOMIC SYSTEM

An economic system defines as a organisation which include resources, services, and goods and distribute them accordingly the need of society, geographical region and nations or population of that nations affordability. An economic systems oversee every aspect of generation, such as land, capital, labor, and physical assets. An economic system is the collection of organizations, agencies, entities, decision-making processes, and consumption patterns that make up a community’s economic structure. The econommic system is controled or handles by the government of respective nation.

Economic systems are further characterized by constraints. This is true even though these constraints must be accessible in order to absorb fresh energy and knowledge, as well as export products, services. Without boundaries, a network structure cannot be identified as a unit of assessment.

And there are type of economic system-

• capatilist economic system
• mixed economic system
• socialist economic systemLet’s understand all types of economic system one by one-Capitalism economic system-In this economic system, things are distributed to people based on their ability to purchase them, which is how likely they are to purchase both goods and services. Thus, a consumer must have financial resources on board to purchase the goods or services they want. Low-cost housing for the impoverished is desperately needed, yet there will be no market demand since the needy lack the purchasing ability to support it. As a result, products will not be made and distributed according to prevailing market forces.Mixed economic system- Mixed economic systems integrate two or more economic activities to create a single core system. Traditionally, a mixed economy combines a market and a command economy to create an economic structure in which the market is largely free of government or national control. However, the government can maintain control over critical businesses and areas such as transportation and military.
  Furthermore, governing institutions in mixed economic systems typically have primary authority over the regulation of private firms and businesses. Mixed economies are extremely popular across the world and offer numerous benefits, but they can also have certain limitations.
  Socialistic economic system- The characteristics of socialism are diametrically opposed to those of capitalism, and they were most memorably articulated by Marx. Socialism is an economic system in which the means of production are held collectively, often by the government. Unlike the United States, which has multiple airlines owned by companies, a socialist nation may have only one government-run airline.
  
  The most fundamental purpose of socialism is to labor for the common benefit rather than personal profit: the needs of society are prioritized over the needs of individuals. Individuals who hold this viewpoint do not compete for profit; instead, they collaborate for the benefit of all.
  Under capitalism, the government is supposed to let the economy alone; under socialism, the government controls the economy.
  Marx envisioned the ideal conclusion of socialism as a genuinely classless or communist society. In such a society, all members are treated equally, with no stratification. Obviously, Marx’s goal of a communist society was never realized, and states that claimed to be communist deviated significantly from his vision.
  
  Remember that societies may be rated on a scale from largely capitalist to mostly socialist. At one end of the continuum, we have civilizations with a relatively free market, while at the other end, we have those with severe government economic control.
  Understanding these economic theories, society has come across the gateway of a more orderly and systematic way of organizing funds. Also with different factors that may help to increase the wealth and safeguard their life earnings. This does not just apply to few people. It worked at all levels of society. from lower-class people to manage their income since middle age and also work for the countries. Although management and security increase with leveling up, as in the case of the banking system.

 
The Growth of the Banking Sector

Banking is the network of financial institutions, such as banks and credit unions, that offer a variety of financial services to individuals, corporations, and governments. Banking services primarily involve receiving deposits, lending money, facilitating transactions, and providing a variety of financial products such as savings accounts, loans, and credit cards.

Banking is important to the economy because it facilitates the flow of money and enables economic activity.The growth of banking was one of the most important and special outcomes of the Commercial Revolution. This simplified the business operations for people around and throughout Europe. The 19th century saw the declaration  of the “cheque and paper money” instead of Coins made of gold and silver.

Well all these sector of bank introduce slowly. Starting with profits of Eastern companies and countries.
During economic revolution a few companies got the charter from the government for trading. Now what is charter, that must have come to mind. Charter is an order from the government or from the ruling committee to do business on behalf of them. This will directly contribute to the economic growth of the country. As the company has to submit or pay some percent from their business profits to the government. All these terms and conditions are mentioned in the charter document. The great examples of trading through charter systems are British East India Company and Dutch East India company. 

The commercial revolution has introduced various factors to Europe and European society. These factors have become the turning point of advancement. The economic money from commercialization has upheld the people in society with the advancement that was introduced. Advancement is education opted for by most people. It also includes the thought of society, or thought that depends on faith or salvation, to the thoughts of individuals and thoughts of self-achievement in society. All this leads to powerful individuals.

Impacts on Trade-

Before looking under the table, let’s see what’s up here. The results are because of actions. And these actions are called capitalism. Capitalism is the root cause of all these revolutions. Then what is capitalism?

Capitalism can be defined as a system of economic and political submersion that leads countries in trade and industry. And they are all run by joint-stock companies.

Now let us discuss the the impact on trade by commercial revolution-

Starting with the European economy, it rises and seems to grow continuously. The lower class became the middle class, and the growth of the upper class has predominantly increased. European nations trade raw materials, and then they produce specialized goods and sell them at higher prices in the market. Well, their market includes all kinds of customers. They see the demand in the market.

They made colonized countries grow only those products that they wanted to sell or those raw materials that were needed on the market. Well, they also look after the demands on the colonized market. and sell them the final products in a higher process. For example, they buy wheat because of market demands. and sell bread at higher prices to both European nations and colonized nations. That is how European trade works.

What happened to the economy during the Revolution?

The commercial revolution began to result in an impact on the economies of countries. The impacts also vary from country to country. And the most significant impact was the result of colonial rule by Europe. For example, India was under the colonial rule of the British. They have suppressed the Indians in many ways and for many years. They have come with the charter act that we have already discussed earlier. Charters allow them to trade, and colonialism helps them trade under their conditions. They have made farmers pay heavy taxes, along with the condition and type of crop they want them to grow. As a result, farmers risked losing their land and were saddled with significant debt. This has heavily disturbed the economic systems of many countries. 

While this scenario was the same throughout the other countries in which they were trading, Whereas the East India companies or European companies and the merchants under the company name are earning heavy capital or great profits. Europe is under the influence of great wealth. Which also led the European country to a sudden increase in population. 

Conclusion-

From the above discussion, we have come to the conclusion that the results of the commercial revolution were different for different countries. Where their European trade increases leads to economies rising in European countries. Europe while 15th to 18th centuary move forward in aspects of modernization. On the other hand, countries under the rule of these European nations were experiencing a severe fall in the economy. And even lost the past principles, culture, heritage, economic stability, unity and many more to count.

All this come to understanding the rule of nature is crule to inhance the living of one society other get eventually supress. This rule of nature is going on since the emerge of life has been came to existence. And economic revolution is just one of them.

All about upsc

The above topic of commercial rovolution is a important part of UPSC CSE. UPSC is one of the most difficult exams. UPSC- Union Public Service Commission. UPSC held exams every year for various class 1 and class 2 posts. these post include Indian Administrative Service (IAS), Indian Police Services(IPS), Indian Revenue Services (IRS), Indian Foreign Services (IFS), Indian Forest Services (IFS) and many more. UPSC has saperate fan base due to various reasons. Every year around 12.5 lakh people apply for the UPSC exams. And only 0.1% get the success among others.

Union Public Service Commission, unlike private occupations and enterprises, should not be addressed with the question, ‘What is there for me?’ Rather, it should have a social reformation perspective, and candidates must understand the big picture of what they can give for the country and how they can make beneficial changes in society’s existing platform.

Despite like other private sector jobs, which are limited to the organization for which you work, Civil Services allows you to contribute to the country and its residents. One who is familiar with this service may understand why there is such a surge in the number of individuals choosing IAS; even if we exclude power and prestige, theirs is still a significant factor.Union Public Service Commission(UPSC) hopefuls believe that knowledge is the primary need, however cracking UPSC outperforms all previous ways by looking for applicants that have a deep passion, dedication, and commitment to the country. UPSC is designed for applicants who aspire to administrate righteous attributes, make thorough decisions, demonstrate sound judgment, and handle challenging situations under any conditions.

Union Public Service Commission (UPSC) examination meticulously analyzes each examinee’s social qualities through three well-defined stages: preliminary, main, and interview. As a result, the UPSC test pattern is designed to be case study-oriented, with an emphasis on current affairs and trending concerns, in tandem with previous years’ government projects and national policies.

Paper Pattern of Union Public Service Commission (UPSC) exams-

Exam has three stage i.e stage 1- preliems

Prelims has two paper. Paper-1 of GS while Paper-2 of maths, aptitude and reasoning.

Stage 2- Mains

Mains contain 9 papers Paper I: General Studies I, Paper II: General Studies II, Paper III: General Studies III, Paper IV: General Studies IV, Paper V: Optional Subject I, Paper VI: Optional Subject II

Optional subjects list-Agriculture

• Animal Husbandry and Veterinary Science
• Anthropology
• Botany
• Chemistry
• Civil Engineering
• Commerce and Accountancy
• Economics
• Electrical Engineering
• Geography
• Geology
• History
• Law
• Management
• Mathematics
• Mechanical Engineering
• Medical Science
• Philosophy
• Physics
• Political Science and International Relations
• Psychology
• Public Administration
• Sociology
• Statistics
• Zoology
• Literature subjects i.e: Assamese, Bengali, Bodo, Dogri, Gujarati, Hindi, Kannada, Kashmiri, Konkani, Maithili, Marathi, Nepali, Oriya, Punjabi, Sanskrit, Santali, Sindhi, Tamil, Urdu, and English, Manipuri, Maithali, Telgu

Latest UPSC Notifications

Name of ExaminationIndian Forest Service (Preliminary) Examination, 2024 through CS(P) Examination 2024Date of Notification14/02/2024Date of Commencement of Examination26/05/2024Duration of ExaminationOne DayLast Date for Receipt of Applications05/03/2024 – 6:00pm

Name of ExaminationCivil Services (Preliminary) Examination, 2024Date of Notification14/02/2024Date of Commencement of Examination26/05/2024Duration of ExaminationOne DayLast Date for Receipt of Applications05/03/2024 – 6:00pm

Starting your preparation?

A sound study plan and a carefully constructed approach are needed for an Upsc candidate to pass the Civil Service Examination . Here are some effective IAS preparation techniques that our IAS Toppers from the previous year employed. To ace the IAS test, you can commit a couple of the following to memory. A step-by-step IAS preparation strategy for the UPSC Prelims, Mains, and Optional subject matter is included in the material.

You may only write the UPSC Mains test (2nd step of the procedure) after passing the Preliminary exam (1st stage). Underestimating the relevance of UPSC Prelims would finish the trip before it had began. Less than 4.5% of applicants who take the preliminary exams advance to the main exam by surpassing the cut-off. In the past few years, the ‘Prelims Hurdle’ demands more effort to succeed than the Main Exam.

Many serious applicants underperform in the Prelims stage because they have spent excess time planning beyond the Prelims.Throughout January and May, focus at least 60% of your effort studying Prelims Topics, including figuring out and comprehending past years’ problems. Also, make sure you can complete the paper in 1 hour and 35 minutes.
Your focus on Prelims all throughout those mentioned months will be well aligned with the UPSC civil services test cycle.

To pass this test, the candidate must have a cogent and cohesive, i.e., correct plan. Candidates who work hard and are psychologically strong are frequently finding the first step of the Preliminary Exam tough. The main contributory factor of this incapacitated to reach their potential is the absence or implementation of a plan that does not suit the individual in question.

Here are some tactics that may come in helpful. You may name them Success/Winning measures. You might use one of them as a strategy or create a blend that works well for you. However, bear in mind that other individual’s techniques, especially the topper’s, do not totally work for aspirants.The fundamental rationale behind this is that there are individual differences—whether cerebral, psychological, social, or otherwise.

Last Updated on February 24, 2024 by shadow_writer