This is the discussion outline:
01
02
03
Cash Flow
Protection
Investment
SURPLUS PRODUCTION
TRADE
TRANSPORT DEVELOPMENT
• Surpluses led to the
development of non-agricultural
activities.
• Agricultural surpluses and
manufactured items brought the
start of real trade with other
communities and the world.
Expansion of local and
international trade led to
emergence of merchants
(entrepreneurs).
Transport infrastructure was
developed, effective means of
transport on land and water.
GROWTH OF TOWNS AND CITIES
• Towns started as small communities near churches or castles.
• Centres for manufacturing and trading, while religion and politics also
grew.
• People earned more money, saved, and started investing—this gave
rise to business-minded people (entrepreneurs).
• Peasants moved into towns for better lives—this is called
urbanisation. They became merchants, artisans, or small farmers.
• Art, buildings, culture, and political systems began to grow and
develop.
• Eventually, strong governments and empires took control of towns
and cities.
SPECIALISATION OF LABOUR
AND EMERGENCE OF GUILDS
“Everyone sticks to what they’re good at”
• Labour specialisation helped people make more
products faster.
• After merchants, craftsmen, and producers
moved into towns, they started forming guilds
(work groups or trade clubs).
• By dividing the work and letting each person
focus on one job, they produced extra goods
(called a surplus).
• These extra goods were then traded or sold,
which helped new markets grow.
GUILDS
• An association of craftsmen or merchants formed for
mutual aid and protection and for the furtherance of their
professional interests.
•
• Provided training and opportunities for trade, such as
festivals.
EXAMPLE
Now imagine all the shoemakers in town form a group called The
Shoemakers' Guild.
🎯 What do they do?
• Set rules for making good-quality shoes
• Train new shoemakers (like apprentices)
• Make sure no one charges way too much or too little
• Help each other if business is slow
👉 That’s a guild—a group of people doing the same job, working together
to protect their work, keep standards high, and support one another.
In short:
Guilds were like clubs for people with the same job, helping each other
succeed and keeping quality in check.
Mercantile law
and development
of business forms
THINK OF IT AS THE RULEBOOK FOR DOING
BUSINESS—BUYING, SELLING, TRADING,
SIGNING CONTRACTS—BASICALLY, HOW TO
PLAY FAIR AND LEGALLY IN THE
MARKETPLACE.
• Mercantile Law - Commercial Law
• Systems based on custom and best practice laws to regulate trade and meant more tax for the
governments.
• Established standards of conduct acceptable to local authorities.
• Basically, is a branch of law that deals with the rights, duties, and conduct of people and businesses
involved in commerce, trade, and sales.
• Business forms were required for entrepreneurs to get loans and financing.
• Main types of business forms used: sole proprietors, simple partnerships, limited partnerships (limited
liability) and corporations.
Technological
progress
First Industrial Revolution (1760-1840)
• Significant economic development in the age of mechanisation
through steam and waterpower.
• Enabled mass production
Technological
progress
Second Industrial Revolution (1870-1900)
• Emprovements in electricity, the internal combustion engine,
analogue communications, entertainment and using hydrocarbons to power the world we live in.
• Enabled mass production and electricity.
Technological
progress
Third Industrial Revolution (1960 onwards)
• revolved around computing and communications technologies
destroying distance and costs barriers.
• Enabled
the
manufacturing
telecommunications devices.
of
computers
and
Technological
progress
Fourth Industrial Revolution
AI, robotics, 3D printing and other 4IR foundations in essence
being digitised capabilities, they have been spreading much
quicker than steam, railways, electricity and computers, i.e.
physical entities.
GROWTH OF MONEY AND FORMS OF SAVING
• Money started as a tool to trade things—everyone agreed to use it to
buy and sell.
• Over time, it changed from simple items to coins, then to paper
money and bank notes.
• This made it easier for people to save money for future use.
REASONS WHY CONSUMERS AND BUSINESSES
SAVE
TRANSPORT DEVELOPMENT
• Savings Fuel Capital Formation
• To Build Wealth and Prepare for the Future
• To Enable Capital Formation and Investments
• To Earn Interest and Grow Their Money
• To Access Loans and Credit
• To Reduce Dependency on Debt
• To Strengthen the Economy
• Capital is the Engine of Growth
• Without Capital Formation, Growth Stalls
• No Growth = No Development
• National Savings Reduce Foreign
Dependency
• Sustainable Development for Future
Generations
Forms of savings
HOUSEHOLD SAVINGS
CORPORATE SAVINGS
• Money that businesses or companies
save instead of spending it all on salaries,
equipment, or dividends.
Example:
Imagine Pick n Pay makes a big profit in
December. Instead of using all the money
immediately, it keeps a portion in the bank
to invest in new stores or to survive during
slower months. That’s corporate saving!
Money that individuals or families save
for emergencies, education, retirement,
or big future purchases.
Example:
A family in Johannesburg saves part of
their monthly income in a fixed deposit
account to pay for their daughter’s
university fees later. That’s household
saving!
FOREIGN SAVINGS
Money from other countries that is invested
or saved in the local economy—usually in
the form of foreign direct investment (FDI)
or international aid that isn’t immediately
spent.
Example:
A company in Germany invests in building
a car factory in South Africa, and the profits
made are partly reinvested and partly
saved locally. That’s foreign saving helping
the local economy!
GOVERNMENT SAVINGS
When the government spends less than
it earns and sets money aside for future
needs or emergencies.
Example:
The South African government receives
more tax revenue than it spends in a
year and places the extra funds in a
sovereign wealth fund or uses it to
reduce national debt. That’s
government saving!
LETS THINK ABOUT
IT
WITH THE DEBTS OUR COUNTRY HAS BEEN ACCUMULATING OVER THE YEARS,
DO YOU THINK THE GOVERNMENT IS ABLE TO SAVE?