1. The Rise of the Atlantic Economy
Unit 3
The Rise of the Atlantic Economy

2. Economic Expansion

3. The Great Shift
For the first time since Rome manufacturing, production, and even agriculture will shift from the Mediterranean region, to Northwest Europe.
Spain, France, and England, and the Dutch will emerge as the great powers of Europe end of the 17th Century .
This will happen due to the:
Increased agricultural output
Expansion of trade
Beginnings of a global economy
The end of religious conflict will lead to a greater focus on internal matters of trade and economy.

4. More land brought under cultivation.
Expansion of Trade
Increased Agricultural Productivity
More land brought under cultivation.
Russia and Eastern Europe uses serfs to produce excess food which they sold to Western Europe.
Rural industry will develop Cottage Production.
Bills of exchange begin to be accepted more commonly providing credit for investment in overseas adventures.
This leads to the development of banking which leads to even greater investment.
Joint-stock companies will be created to spread risk in a major investment.

5. Global Economy
With the exploitation of the New World new raw materials begin to make their way to Europe.
Tomatoes, corn, rum, spices, tobacco and most importantly potatoes make their way to Europe and change the continent.
The Rhine, Rhone, Danube, and Scheldt Rivers will link European capitals to the world spreading goods and knowledge.
England and the Netherlands will form East India trading companies to bring these goods to ports using a state sanctioned monopoly.
Although tropical diseases will kill many European explorers, the diseases the explorers brought with them will devastate the new world.

6. The Golden Age of Spain

7. Centralization
Spain was created when King Ferdinand II of Aragon married Queen Isabella of Castile in 1469
This leads to the two largest powers on the Iberian peninsula to form one of the first nation states leading to:
1. Castilian becoming Spanish
2. A crusade forcing the Moors out of Spain in 1492
A functioning bureaucracy
Stripping many nobles of their titles
Starting the inquisition
Expanded colonial holdings in America
The Reformation barely touched Spain as the powerful inquisition will keep it in check.

8. Spanish Economy
Due to lack of arable land Spain's economy was based on the wool trade and taxing its peasantry.
Due to the heavy tax burden that was a revolt against Charles I (V) in 1520.
When Charles abdicated he divided his kingdom between the Spanish holdings and the Austrian holdings.
Expansion of colonial holding will lead to an expansion of the economy due to an influx of gold and silver.

9. Spain and Phillip II
Spain was the leading power of western Europe at the start of the 1500s
Phillip II
Saw himself as the defender of Catholicism
Worked to increase Hapsburg power
Held power through elaborate court rituals meant to impress and intimidate
Phillip felt it was his job to expel the Turks and carried out a naval war against Suleiman the Magnificent from
The Turks attempted to capture Granada but were defeated at the battle of Lepanto

10. Spain and the Netherlands
During this time, Spain controlled the Netherlands
Three main factors led to the Netherlands fighting for independence from Spain
Heavy taxation of the Netherlands by Spain to fund its empire
Protestantism in the Netherlands - As a Catholic king, Philip of Spain felt it was his duty to protect Catholicism and destroy Protestantism
Spain began to centralize its power and bring the Netherlands even more under their control, leading to resistance

11. Spain and the Netherlands
Dutch Protestant nobles rebelled in 1560's
Spain Appointed the Duke of Alba to put down the revolt
Alba used a heavy hand executing leaders and imposing taxes and destroying self government in the Netherlands prompting a full Dutch revolt led by William of Orange

12. The Spanish Armada
The English became increasingly troublesome for Phillip
English had supported the Dutch in their revolution
The English were increasingly challenging the Spanish for naval power
1586 – Phillip decides to invade England to overthrow Elizabeth; devotes all resources to preparing for this invasion for the next two years
Launches 130 ship armada (large fleet of ships), with 33,000 soldiers, which finds its way into the English Channel

13. Battle of Gravelines
Spanish crescent formation was broken up by the English, using fire-ships
Spanish armada can’t defeat English, fleet is gradually destroyed by lack of water, storms, and disease – only half the ships and around 10,000 men survive

15. More Dutch
The Dutch were successful on the Sea but the Spanish were superior on land
During this war for independence, the English, the French, and Suleiman of the Ottoman empire supported the Dutch against the Spanish
The Dutch win independence from Spain, in the peace of Westphalia in 1648
This was the beginning of the decline of Spain

16. Spanish Decline Over time, the Spanish empire declined from its glory
Economy
Borrowed large amounts of money to support wars, such as against the Dutch
Gold and silver from the New World first made the country rich, then inflated the currency
Industry and agriculture declined (some say because they were rich, they became poor)

17. Spanish Decline, continued
The Spanish and Portuguese also expelled Muslims and Jews from the country
Many Muslims and Jews were artisans, merchants, bankers, etc., so they took their knowledge, skills, and money with them – “brain drain.”
The new leadership after Philip was generally incompetent in running the empire effectively
Agricultural output fell
The colonies became a burden with huge administrative costs and few economic opportunities because of poor management

18. An Empire Spread too thin
The Spanish Empire was spread from Italy, to Iberia, to the Netherlands, to South America, to the Philippines
Spanish entry in the 30 years war also cost a great deal of lives and treasure, further weakening Spain
Revolts occurred in Catalan and Portugal over increased taxation
By the mid 1600's Spain had lost its Italian possessions to France

20. Summary So, in the golden age of Spain
Spain was ruled by the Hapsburg empire, a ruling family that ruled throughout Europe
Spain tried to exert influence and control over other countries, such as the Netherlands and England
Many factors, such as loss of the Netherlands, the defeat by England, the decline of the Spanish economy, and poor leadership following Philip the II led to Spain’s decline