The American Revolution’s Economic Roots

Category: history

Let’s change things up a bit and talk about some historical events in the world of economics. For this first post, we’re going to talk about the Revolutionary War.

Wondering what the factors were that brought about the American Revolution? Despite nearly 250 years having passed since the event, there are still a number of parallels that still hold true today. And like most modern wars and military conflicts, the exact factors are muddled, combining several complex factors in the areas of politics, economy, and even the social realm.

With the common rallying cry of the time being “No taxation without representation!”, the concerns of the soon-to-be fledgling nations economy were surely at the forefront of the colonist’s minds.

The Growing Debt of Late 1700’s Britain

Near the beginning of the 1700’s, the British Government was extremely prosperous, but soon it had begun to taken on increasingly large amounts of debt, largely due to the Seven Years War. It was proposed then that with the American colonies doing so well, they should bear more of the liabilities of the crown.

This thought lead to the passing of several laws that would impact the livelihoods of American colonists.

The Impacts of Imposed Economic Laws

While there were a number of Acts passed to aid in the movement of economic wealth from the colonies to Britain, three notable ones stand out in the history books. These three pillars are the Currency Act of 1764, the Sugar Act of 1764, and the Stamp Act of 1765.

The culmination of these acts, as well as numerous others made it difficult for the colonies to have any hand in the determination of their local economy, preventing them from creating or utilizing their own currency, and placing large taxes on many staples in their lives.

No Taxation Without Representation

With all of these acts in place, the colonists had had enough. Exhausting conventional options such as attending special sessions held by Britain, and frustrated with their lack of input with the decisions made, the situation escalated. Merchants and towns began to band together, at first to refuse imported goods and then to form their own militias.

Because of these acts of taxation, Britain had placed one of the powder kegs that would be a starting point of the Revolutionary War.


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