The Dutch Republic and Capitalism

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Merchants

During the fifteenth and sixteenth centuries, merchants were a part of commerce as well as politics in Europe. Their influence expanded across different spheres of life as they prospered from trading goods between towns and countries. Moreover, they affected production and fashion by introducing new trends from overseas and expanding the development of new materials. The production of silk brought by merchants from China to Italy and Turkey is an excellent example of the influence that merchants had during that time period (Wiesner-Hanks 219).

The introduction of other materials can also be traced to international trade. Moreover, some technological progress can also be contributed to commerce as people wanted to make more products with less effort. Thus, such devices as windmills and ribbon looms increased production and allowed people to hire fewer workers or find less skilled staff. This new approach to production was successfully implemented by merchants from the Netherlands who became masters of refining raw materials such as sugar, gin, tobacco, and leather (Wiesner-Hanks 220). This type of commerce was very profitable for the country that specialized in re-export.

Banking

Growing consumption and trade of goods led to the increase in popularity of money-lending. Wealthy individuals grew their profits by lending money not only to citizens but also to businesses and governments. While coins were considered to be the most valuable items to exchange, paper bills could be used as well. Specific coins became more valuable than others due to differences in production. It is notable that coins’ quality and form could be attributed to the country’s financial situation.

Thin and blackened silver coins, as well as small coins with impure gold, could be interpreted as a sign that a government needed more money (Wiesner-Hanks 221). Also, the fact that these coins were supposed to be treated the same by commoners signifies the fact that countries wanted to gain more profit by raising taxes rather than making other possible changes.

Urban Life

The influential power of merchants also allowed them to have some political power. In fact, many cities with councils became governed by wealthy families of dealers (Wiesner-Hanks 224). They changed the physical structure of towns as well as their market space. The hierarchy also shifted as masters did not want to invest money into their pupils who eventually lost the opportunity to advance in their career. These men became known as journeymen, who formed a separate class of workers (Wiesner-Hanks 226).

Masters and journeymen classified themselves by outlining different values and rules for their positions. The parallels between these types of workers and working-class and middle-class employees are rather interesting.

The existence of servants and their prevalence in big cities was also representative of urban life. The fact that many servants worked in bigger towns showed the level of income of an average person. At some point, people that employed servants became aware of their envisioned social differences. Therefore, individuals that could afford it started to separate servants physically by putting them in separate rooms. Moreover, the social structure was enforced outside of one’s household by matters of restrictions for servants to wear certain clothes and fabrics.

The Dutch Republic

A number of reasons can explain the prosperity of the Dutch Republic. First of all, the Netherlands did not have the same political structure that was prevalent in other countries of Europe. These people did not favor monarchy and merchants continued to enforce their vision of a government. Moreover, the toleration of different religions also distinguished this country from the others. It is possible that people were able to avoid various conflicts that ruined other states.

Rigid socioeconomic systems that were established in other countries were not enforced here as well, allowing people with enough ambition to rise through the ranks and gain political recognition (Wiesner-Hanks 345). The sum of these conditions created a different philosophy for Dutch citizens who did not want to live according to the rules that were established in the rest of Europe. It also allowed them to mediate between different countries and trade with them even during various political conflicts. Therefore, while the Dutch did not follow the rules of frugality and often enjoyed expensive products and activities, their hard work and social toleration allowed them to pay for this lifestyle.

The Tulipomania

During the 1630s, the Dutch Republic was overcome by the so-called tulip madness (Mackay 3.1). In the beginning, the flowers unexpectedly gained popularity among the wealthy people of Amsterdam. Then, the desire to buy tulips spread to other people, including even those who could hardly afford to buy a flower. The prices for tulips rose as they became more and more popular. The market was occupied by merchants that were more willing to trade tulips than anything else.

Thus, the country’s economy became unstable. Once the madness ended, many people found themselves in a worse situation than they were before. Many people lost the fortune that they were able to acquire by reselling flowers. Interestingly, the government did not want to involve itself in these matters and abstained from taking any action by calling the trade of tulips gambling. They were not wrong as many merchants engaged in speculation and price augmentation. It is possible that the country’s government would not be able to mitigate this problem in any case. The tulip madness significantly affected the Dutch Republic’s economy and created a disbalance that was even worse than before.

Works Cited

Mackay, Charles. . 1848. Web.

Wiesner-Hanks, Merry E. Early Modern Europe, 1450-1789. 2nd ed., Cambridge University Press, 2013.

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