Were the 16th century charter companies part of capitalism?

Question

By charter companies, i refer to the monopolies granted by the king to merchants for a certain number of years.

Answer 1

Yes.

Their way of operation was to buy and sell at a profit - the essence of capitalism.

The monopoly companies also paved the way for private joint stock companies (pioneered in Holland, I think). Joint stock companies are a means of combining the capital of many smaller investors to accumulate enough capital to carry on a venture. Without that combined capital no one person could afford to carry on an enterprise. The combination of capital is what makes modern capitalism possible.

Answer 2

It was part of mercantilism. Adam Smith wrote the Wealth of Nations which is the theoretical foundation of capitalism in opposition to mercantilism not Communism which would not be proposed for another hundred years.

http://en.wikipedia.org/wiki/Mercantilism
"Mercantilism is an economic theory that holds that the prosperity of a nation depends upon its supply of capital, and that the global volume of trade is "unchangeable". Economic assets, or Capital, are represented by bullion (gold, silver, and trade value) held by the state, which is best increased through a positive balance of trade with other nations (exports minus imports). Mercantilism suggests that the ruling government should advance these goals by playing a protectionist role in the economy, by encouraging exports and discouraging imports, especially through the use of tariffs. The economic policy based upon these ideas is often called the mercantile system.

Mercantilism was established during the early modern period (from the 16th to the 18th century, which roughly corresponded to the emergence of the nation-state). This led to some of the first instances of significant government intervention and control over market economies, and it was during this period that much of the modern capitalist system was established. Internationally, mercantilism encouraged the many European wars of the period, and fueled European imperialism, as the European powers fought over "available" markets. Belief in mercantilism began to fade in the late 18th century, as the arguments of Adam Smith and the other classical economists won favour in the British Empire (among such advocates as Richard Cobden) and to a lesser degree in the rest of Europe (with the notable exception of Germany"