Mercantilism is an economic theory that was popular in Europe from the 16th to 18th centuries. The purpose was to increase a nation's wealth by maximizing trade surplus and collecting gold and silver. This was achieved through active government intervention in trade activities, such as imposing high tariffs on imported goods and subsidizing exports.
The idea behind this theory is that the amount of gold and silver is the true measure of a nation's overall wealth and prosperity, and for countries lacking in such resources, the best way to accumulate gold and silver is by selling its products to other countries while limiting purchases from overseas. This theory was doomed to fail because by equating the amount of gold and silver to a nation’s overall wealth, the assumption would be that the total wealth in the world is static. Therefore, for some countries to become richer, some other countries would inevitably become poorer. This makes the development of a global economy impossible. Also, such practices would lead to higher opportunity cost because import restrictions would prevent a country from utilizing cheaper resources from other countries to provide supply for its production.
Tuesday, February 5, 2019
What was the purpose of the mercantilism?
Subscribe to:
Post Comments (Atom)
Summarize the major research findings of "Toward an experimental ecology of human development."
Based on findings of prior research, the author, Bronfenbrenner proposes that methods for natural observation research have been applied in ...
-
One way to support this thesis is to explain how these great men changed the world. Indeed, Alexander the Great (356–323 BC) was the quintes...
-
Polysyndeton refers to using several conjunctions in a row to achieve a dramatic effect. That can be seen in this sentence about the child: ...
-
Both boys are very charismatic and use their charisma to persuade others to follow them. The key difference of course is that Ralph uses his...
-
At the most basic level, thunderstorms and blizzards are specific weather phenomena that occur most frequently within particular seasonal cl...
-
Equation of a tangent line to the graph of function f at point (x_0,y_0) is given by y=y_0+f'(x_0)(x-x_0). The first step to finding eq...
-
Population policy is any kind of government policy that is designed to somehow regulate or control the rate of population growth. It include...
-
Gulliver cooperates with the Lilliputians because he is so interested in them. He could, obviously, squash them underfoot, but he seems to b...
No comments:
Post a Comment