Colonization (or colonisation) occurs whenever any one or more species populate an area. The term, which is derived from the Latin colere, "to inhabit, cultivate, frequent, practice, tend, guard, respect", originally referred to humans. During the 19th century, biogeographers appropriated the term to also describe the activities of birds, bacteria, or plant species. Human colonization is a narrower category than the related concept of colonialism. Colonization refers strictly to migration, for example, to settler colonies, trading posts, and plantations, while colonialism deals with this as well as the ruling of new territories' existing peoples.

In ancient times, maritime nations such as the city-states of Greece and Phoenicia often established colonies to farm what they saw as uninhabited land. In classical times, land suitable for farming was often claimed by migratory "barbarian tribes" who lived by hunting and gathering. To ancient Greeks and Phoenicians, the land was regarded as simply vacant. However this does not mean that conflict did not exist between the colonizers and native peoples. Greeks and Phoenicians also established colonies with the intent of regulating and expanding trade throughout the Mediterranean and Middle East.

Christopher Columbus (before 31 October 1451 – 20 May 1506) was an explorer, colonizer, and navigator, born in the Republic of Genoa, in what is today northwestern Italy. Under the auspices of the Catholic Monarchs of Spain, he completed four voyages across the Atlantic Ocean that led to general European awareness of the American continents. Those voyages, and his efforts to establish permanent settlements in the island of Hispaniola, initiated the process of Spanish colonization, which foreshadowed the general European colonization of what became known as the "New World".

In the context of emerging western imperialism and economic competition between European kingdoms seeking wealth through the establishment of trade routes and colonies, Columbus's speculative proposal to reach the East Indies by sailing westward received the support of the Spanish crown, which saw in it a promise, however remote, of gaining the upper hand over rival powers in the contest for the lucrative spice trade with Asia. During his first voyage in 1492, instead of reaching Japan as he had intended, Columbus landed in the Bahamas archipelago, at a locale he named San Salvador. Over the course of three more voyages, Columbus visited the Greater and Lesser Antilles, as well as the Caribbean coast of Venezuela and Central America, claiming them for the Spanish Empire.

Milton Friedman (July 31, 1912 – November 16, 2006) was an American economist, statistician, and author who taught at the University of Chicago for more than three decades. He was a recipient of the Nobel Memorial Prize in Economic Sciences, and is known for his research on consumption analysis, monetary history and theory, and the complexity of stabilization policy. As a leader of the Chicago school of economics, he influenced the research agenda of the economics profession. A survey of economists ranked Friedman as the second most popular economist of the twentieth century behind John Maynard Keynes, and The Economist described him as "the most influential economist of the second half of the 20th century…possibly of all of it."

Friedman's challenges to what he later called "naive Keynesian" (as opposed to New Keynesian) theory began with his 1950s reinterpretation of the consumption function, and he became the main advocate opposing activist Keynesian government policies. In the late 1960s he described his own approach (along with all of mainstream economics) as using "Keynesian language and apparatus" yet rejecting its "initial" conclusions. During the 1960s he promoted an alternative macroeconomic policy known as "monetarism". He theorized there existed a "natural" rate of unemployment, and argued that governments could increase employment above this rate (e.g., by increasing aggregate demand) only at the risk of causing inflation to accelerate. He argued that the Phillips curve was not stable and predicted what would come to be known as stagflation. Friedman argued that, given the existence of the Federal Reserve, a constant small expansion of the money supply was the only wise policy.