<P> The historiography of capitalism can be divided into two broad schools . One is associated with economic liberalism, with the eighteenth - century economist Adam Smith as a foundational figure, and one with Marxism, drawing particular inspiration from the nineteenth - century economist Karl Marx . Liberals tend to view capitalism as an expression of natural human behaviours which have been in evidence for millennia, and the most beneficial way of promoting human wellbeing . They tend to see capitalism as originating in trade and commerce, and freeing people to exercise their entrepreneurial natures . Marxists tend to view capitalism as a historically unusual system of relationships between classes, which could be replaced by other economic systems which would serve human wellbeing better . They tend to see capitalism as originating in more powerful people taking control of the means of production, and compelling others to sell their labour as a commodity . For these reasons, much of the work on the history of capitalism has been broadly Marxist . </P> <P> The origins of capitalism have been much debated (and depend partly on what you think the defining features of capitalism are). The traditional account, originating in classical eighteenth - century liberal economic thought and still often articulated, is the' commercialization model' . This sees capitalism originating in trade . Since evidence for trade is found even in palaeolithic culture, it can be seen as natural to human societies . In this reading, capitalism emerged from earlier trade once merchants had acquired sufficient wealth (referred to as' primitive capital') to begin investing in increasingly productive technology . This account tends to see capitalism as a natural continuation of trade, arising when people's natural entrepreneurialism was freed from the constraints of feudalism, partly by urbanization . Thus it traces capitalism to early forms of merchant capitalism practiced in Western Europe during the Middle Ages . It began to develop into its modern form during the Early Modern period in the Protestant countries of North - Western Europe, especially the Netherlands (Dutch Republic) and England: traders in Amsterdam and London created the first chartered joint - stock companies driving up commerce and trade, and the first stock exchanges and banking and insurance institutions were established . Foundational thinkers for this approach include Adam Smith, Max Weber, Fernand Braudel, Henri Pirenne, and Paul Sweezy . </P> <P> However, the' commercialization model' has been questioned, with a leading competitor being the' agrarian model' . This notes that traditional mercantilism focused on moving goods from markets where they were cheap to markets where they were expensive rather than investing in production, and that many cultures (including the early modern Dutch Republic) saw urbanisation, and merchants amassing great wealth, without capitalist production emerging . The' agrarian model' instead argues that capitalism arose from unique circumstances in English agrarianism . </P> <P> The agrarian argument developed particularly through Karl Polanyi's The Great Transformation (1944), Maurice Dobb's Studies in the Development of Capitalism (1946), and Robert Brenner's "Agrarian Class Structure and Economic Development in Pre-Industrial Europe" (1976). In the wake of the Norman Conquest, the English state was unusually centralised . This gave aristocrats relatively limited powers to extract wealth directly from their feudal underlings through political means (not least the threat of violence). England's centralisation also meant that an unusual number of English farmers were not peasants (with their own land and thus direct access to subsistence) but tenants (renting their land). These circumstances produced a market in leases . Landlords, lacking other ways to extract wealth, were incentivised to rent to those tenants who could pay the most, while tenants, lacking security of tenure, were incentivised to farm as productively as possible to be able to win leases in a competitive market . This led to a cascade of effects whereby successful tenant farmers became agrarian capitalists; unsuccessful ones became wage - labourers, required to sell their labour in order to live; and landlords promoted the privatisation and renting out of common land, not least through the enclosures . In this reading,' it was not merchants or manufacturers who drove the process that propelled the early development of capitalism . The transformation of social property relations was firmly rooted in the countryside, and the transformation of England's trade and industry was result more than cause of England's transition to capitalism' . </P>

5. in a historical context why did capitalism emerge in the west