Liberalism and Capitalism Today

2Economic and Sociological Conditions

Legal and political conditions were not sufficient for capitalism to emerge: economic and sociological conditions also had to be met. The economic conditions can be explained by the appearance of hitherto unknown economic structures (increasingly distant trade relations and mass, industrial goods manufacturing) that gradually supplanted traditional sectors of activity (agricultural production and the creation of a small number of handicrafts). The technical progress at the root of these evolutions, if they allowed economic development, was not without dangers at the human level for members of the new social classes born of these transformations. As for the sociological conditions, they were the consequences of the emergence of the Protestant religion whose precepts led to an economic rationalization, in particular through a new vision of work, money and financial markets.

2.1. Trade and industry: competitors of agriculture and the craft industry

Capitalism originated in agriculture and handicraft. However, modern capitalism found its full development first in trade and then in industry, thanks to the expansion of trade which was made possible by the introduction of free competition.

2.1.1. The lesser role of agriculture

As soon as the right of ownership appeared, capitalism settled in handicrafts and agriculture. Yet de Tocqueville (1835) explained that modern democracy modified the economic and social situation to the detriment of these ...