European economic systems in the American colonies during the 1600s and early 1700s were primarily shaped by mercantilism, a system where the colonies existed to enrich the mother country, mainly Britain. Under mercantilism, colonial economies were designed to supply raw materials to Britain and serve as exclusive markets for British manufactured goods. Trade was tightly regulated through laws like the Navigation Acts, which required colonial goods to be shipped on British vessels and often restricted trade with other European powers

. The economic activities in the colonies varied regionally:

• New England Colonies focused on shipbuilding, fishing, lumber, and small-scale farming due to rocky soil and a short growing season. Their economy was more diversified and included manufacturing and trade

• Middle Colonies had fertile soil suitable for growing grains like wheat, earning them the nickname "breadbasket colonies." They developed major port cities such as New York and Philadelphia, becoming commercial hubs with a mixed economy of farming and commerce

• Southern Colonies relied heavily on plantation agriculture with cash crops like tobacco, rice, and indigo. These colonies depended on enslaved African labor to cultivate these labor-intensive crops, which were exported to Britain and other markets

The British mercantile system aimed to maintain a favorable balance of trade by maximizing exports from the colonies and minimizing imports. The government and British merchants partnered to protect their economic interests through trade barriers, subsidies, and the Royal Navy's protection of shipping routes. Although this system enriched Britain, it often limited colonial economic freedom and led to smuggling and growing colonial dissatisfaction

. Colonial economies were not only based on agriculture but also included significant shipbuilding industries, particularly in New England, where abundant timber resources and skilled labor enabled the production of ships used in both local and transatlantic trade. By the mid-18th century, American- built ships made up a substantial portion of British coastal and European trade fleets

. Overall, the European economic systems in the American colonies combined mercantilist policies with regional adaptations to local resources and labor systems, including indentured servitude and slavery, laying the groundwork for the colonies' economic development and eventual push for independence