ABSTRACT
The old concept of the commercial revolution remains a useful and valid notion. The commercial revolution may be said arbitrarily to have begun in 1488 when the Portuguese Bartholomew Diaz rounded Cape Horn. Thus pioneered a non Mediterranean route for trade to the Far East which involved direct European contacts in the whole arc from Japan to the Persian Gulf. The commercial revolution is a classic example of the widening of the market that Adam Smith believed would encourage specialization in manufacture and an increase in efficiency. The commercial revolution set in motion demands that made it increasingly profitable to solve the problems on the supply side with new technology, but a new mentality was required to yield the corps of inventors and entrepreneurs who actually created the lowered cost curves that define technically the industrial revolution. Lateral expansion of European and world economy has several significant links to the industrial revolution.
