The document summarizes economic and social changes during the 18th century in Europe. It discusses that the economy was originally based on agriculture under the system of mercantilism. However, improvements in agriculture through new crops from America and machinery led to economic growth. Liberal economic ideas developed by Adam Smith advocating for free markets also became popular. Cottage industries developed where peasants manufactured goods at home. Trade between Europe and the American colonies boomed, though it also included the slave trade from Africa. However, society did not change dramatically, remaining stratified with demands growing for more political power from the emerging bourgeoisie class.

1. Economic and social changes
during the 18th century

2. First: what was the economy in the Old
Regime like?
- It was based on agriculture:
- most of the people worked in
the fields.
- agriculture used basic
techniques (biennial or triennial
rotation).
- most of the land belonged to
the nobility and the clergy

3. Mercantilism was the economic system
Mercantilism: the more precious metals (gold and silver) a country has,
the richer a country is.
The government intervened in the economy by:
- promoting trade
- forcing the colonies in America to buy the products that
had been manufactured in Europe.

4. However, during the 18th century
agriculture improved. Why?

5. Why did the economy improve in the 18th
century?
1. New crops were introduced from America:
2. Fallowland (land with no crop) was planted, so there was more
food.
3. New machines were introduced in the fields. These technical
improvementes meant that people could obtain more products.

6. New ideas in economy became popular
François Quesnay
defended Physiocracy
The wealth of a nation is
the land (agriculture and
mining) and must be
promoted.
The State should not
control the economy.

7. Liberalism: the most important economic
theory of the 18th century
- Created by Adam Smith (from Scotland)
- There should be a free economy:
. Each person should try to obtain the
maximum benefit.
. If everyone does that, the economy
would work.
. The State should not intervene in the economy. Taxes should be
low, and that would promote the economy. The State should only
proctect the society and promote public works (roads, ports, bridges…).
. Buyers and sellers should agree on the price of the products
freely (law of supply and demand)
I believe
in free
market!

8. Changes in the industry
During the 18th century a big revolution in economy started to take
place: the industrial revolution. It began in England, and spread over
Europe later. We will study it in Unit 3.
Apart from that during the Old Regime the handcraft production was
promoted in workshops were luxury ítems were produced, such as:

9. And also, because the production of food in agriculture improved as we
saw, peasants had more time to manufacture textiles at home:
That’s what we call COTTAGE INDUSTRIES
How did it work?
An employer gave the raw materials to the peasants (wool,
leather, etc.)
The peasant elaborated clothes with those materials during their
free time. When finished, the employer took the products and sold
them.
The peasants got a salary. They had more money SO they could
buy more ítems, and this helped the economy grow!

10. Cottage industry

11. Trade between Europe and America boomed!
The colonies in America provided:
cotton
sugar
tea
Luxury
ítems from
Asia coffee
cocoa

12. Some ports in Europe grew larger because of this
trade: London, Seville, Lisbon, Rotterdam…

13. Unfortunately, also slaves from Africa! They were
taken to America and used there to work in the
fields. The slave merchants thought slaves could
be captured, bought and sold! Horrible!

14. Did the society change in the first half of the 18th
century? Not much… There were some changes though.
- The society was stratified (remember: there were three
social groups: two privileged (nobility and clergy, which did
not pay any taxes, or work) and one unprivileged group (the
Third State, which memebers worked and paid taxes).
- Some members of the Third State (the bourgeoisie) became
richer basically because of commerce. They demanded
political power.