1. Introduction. The rise and fall of European mercantilism
At the start of the first millennium, Western Europe was the most peripheral
region within Eurasia. Like Africa, its exports largely consisted of forest products and
slaves, and it had direct economic links with just two other Eurasian regions, Eastern
Europe and the Islamic world. By contrast, the Muslim world had direct economic
contacts with all the regions of the then known world: Eastern and Western Europe, sub-
Saharan Africa, the steppe societies of central Asia, and the highly developed
civilisations of South Asia, Southeast Asia and East Asia (Findlay and O'Rourke 2007).
By the 18th century, Western Europe was no longer a peripheral appendage of the
Eurasian landmass, but had become geographically and politically central. It was now in
direct contact with all other regions of Eurasia, as well as with sub-Saharan Africa, but
more importantly controlled both North and South America, which were fully integrated
into the world economy, importing slaves from Africa, exporting a variety of colonial
goods to Europe, and exporting silver both to Europe and to Asia via the Philippines. As
for Eastern Europe, it was now in direct contact not just with central Asia and the Muslim
world, but with East Asia and North America as well, as a result of Russia's Siberian
conquests which would prove to be the most enduring of all the European imperialisms of
that time.
In contrast to China, which was relatively self-sufficient, European merchants and
states had a strong interest in seeking out direct routes to sub-Saharan gold deposits, thus
bypassing the Muslim middlemen to the who controlled the trans-Saharan trade;
purchasing African slaves, and using these on the sugar plantations of newly-discovered
offshore African islands; and ultimately in circumnavigating Africa, reaching Asian spice
markets directly, and again cutting out Muslim (and Venetian) middlemen. Once
Columbus stumbled upon the Americas, Europeans had every incentive to exploit the
vast resources of this New World as fully as possible. All of these activities were
extremely lucrative, and the mutual dependence of Power and Plenty (Viner 1948) meant
that states as well as merchants had a powerful motive to pursue them. Trade profited
merchants, but also yielded revenues to the state; while the state needed revenues to
secure trading opportunities for its merchants, by force if necessary. Trade and empire