Name Capitalism

The History of Capitalism

The word “capitalism” was coined in the mid-1900s by
German sociologist Karl Marx, who used the word to
describe the private ownership of property or business.
But the earliest form of capitalism emerged several
hundred years before that, out of an economic system called feudalism.

Feudalism was a social and governmental structure in which power was

spread out amongst different lords, who each had control over a certain
area of land. In this system, serfs (peasants) worked the lord’s land, and
were allowed to keep for themselves a portion of what was produced in
exchange for their work. Feudalism lasted for about a thousand years,
however, an increase in foreign trade, which led to an increase in the use
of money and also to inflation, eventually caused feudalism to break
down.

Capitalism emerged in the mid 1600s. At that time there were three major
market roles: the producer, the consumer, and the merchant (who
bought what the producer produced and sold it to the consumer). But
over time the merchants started placing orders for goods and paying in
advance. Later, they supplied raw materials and paid the wages of the
people producing the finished goods. The act of paying wages was the
key event that changed the merchants into capitalists (who own and
control the means of production).

It was a difficult change for society. The decline of feudalism had left
many serfs in need of a new means of livelihood. The new capitalists were
trying to produce more for less, and laws were passed that set a limit on
how much wage laborers could be paid. For the first time, the work
environment was competitive. Additionally, it was difficult for people who
were used to working the land according to the cycles of nature — and
used to not working on approximately 165 holidays a year — to get used
to working set hours indoors.

© www.EasyTeacherWorksheets.com
Name Capitalism

QUESTIONS: The History of Capitalism

Circle the correct answer.
1. Karl Marx coined the word capitalism to mean:
A. a social and governmental structure in which power was spread out
amongst different lords
B. private ownership of property or business
C. the three major market roles
D. the act of paying wages

2. What caused feudalism to break down?

A. increase in foreign trade
B. inflation
C. increase in the use of money
D. all of the above

3. Which of the following was NOT one of the three major market roles in the
mid-1600s?
A. producer
B. consumer
C. capitalist
D. merchant

4. What was the key event that changed merchants into capitalists?
A. increase in foreign trade
B. inflation
C. increase in the use of money
D. the act of paying wages

5. Why was the transition from feudalism difficult for the serfs?
A. there was a limit on how much wages workers could be paid
B. the work environment was competitive
C. people had to spend a lot more time working
D. all of the above

© www.EasyTeacherWorksheets.com