Fernand Braudel: World-Economies and the Rise of Capitalism
Fernand Braudel: World-Economies and Capitalism
Fernand Braudel argues that a kind of global society exists, hierarchical yet recognizable, much like an ordinary society. The world-economies built in Europe after its expansion explain the rise of capitalism. These world-economies are defined by a triple reality:
- They occupy a specific geographical area, which defines their limits.
- They always have a pole, a center represented by a dominant city, formerly a city-state, now a capital of the economy.
- They are divided into different zones: the heart or center, the intermediate region surrounding the center, and the periphery.
The Center-Periphery Dynamic
The periphery consists of subordinate and dependent areas characterized by the division of labor. Although there may be shifts, as happened in Europe around 1500 when smaller centers like Venice, Genoa, Amsterdam, and London emerged, and in 1929 when the center moved to New York, the overall structure persists. These shifts often occur due to economic problems, which pose a threat not only to the current center but also to potential new centers. Crises are a test; the strong survive, and the weak perish.
Historical Examples of Centers
The policy pursued by the East India Company’s fleet resorted to violence, much like previous dominant powers, to secure their position. Venice was the first center in the 15th century. When we say that Amsterdam was the center of the world, we must acknowledge that it reigned alone from the West Indies to Japan by the middle of the Enlightenment (18th century). As for London, being the capital of Great Britain gave it great power in the international market. Today, the center is in New York.
Intermediate and Marginal Regions
The intermediate countries, those found around the center (in this case, Amsterdam or the Netherlands), are countries where few people could find freedom, with incomplete banking and financial organizations, and traditional industries. In 1650, this would include the downstream countries of the Baltic, England, Germany, France, Portugal, Spain, and Italy north of Rome.
Marginal regions of the center included Hamburg, Italy south of Rome, and, on the other side of the Atlantic, the New World, which was lost in widespread slavery. Central Europe, up to Poland, had led to the reappearance of serfdom in the center.
The Industrial Revolution and the Rise of England
All these changes resulted in the launch of new businesses, industries, transport, and the Industrial Revolution. The English Industrial Revolution (late 17th century) was a renewal for the entire industry and led to greater power. It was a slow process, almost unknown at first. All sectors of British industry responded perfectly to the expectations and requirements before such changes were expected. There were many discoveries of machine tools and materials, especially by craftsmen. Many small loans were requested to start industries to get ahead. However, London did not gain industrial power until 1830. Thus, England became the “owner” of the world.
Braudel’s View on Capitalism
For Braudel, the nature of capitalism has not changed and is based on three tenets:
- Capitalism is based on the exploitation of international resources and possibilities.
- It relies on de facto and de jure monopolies.
- Economic activities are at the summit or tend towards it, representing a large area of profit.
Capitalism is commodity production at the highest level of development. Its main feature is its self-productive capacity.