From mercantilist beginnings, America became the most successful capitalist nation in history, partly based on the Protestant (Puritan) work ethic and the notion that God helps those who help themselves. The institution of capitalism flourished in America with its valuable labor supply, seemingly endless natural resources, broad rivers and sheltered harbors, all of which fostered a booming trade both within the colonies and with the rest of the world.
The basic idea of capitalism is that one invests one's capital resources in order to increase wealth. The idea is no different from what occurs today when people invest in the stock market, rental properties or businesses. People who put part of their earnings into 401(k) plans are practicing basic capitalism. The early colonial stock companies were based upon the same principle. Investors in the London company expected that the colonial economy would make a profit, and that they would share in that profit. The fact that many investment ventures could not prove to be profitable does not undermine the basic theory. Throughout history businesses have failed; companies have gone bankrupt; schemes and scams have cost investors millions upon millions of dollars; areas of the market that proved extremely profitable for a time eventually ceased producing wealth; but over the course of the years, wealth has been used to create more wealth, and putting money to work has always had an appeal to investors.
Over the years people have tried to create formulas to ensure profitable investments, but capitalism is a human endeavor, and human beings, imperfect creatures that we are, do not always make wise decisions. As a result, the progress of capitalism has not been an upward moving curve, but rather a jagged line with highs and lows, rises and falls. For the early colonists the most reliable form of investment was to engage themselves in hard work.
World History
