What is mercantilism?

Mercantilism is mostly the historical economic theory that holds the wealth of the nation, can be measured by its prepared capital supply, usually held in a particular form, such as gold or silver. Mercantilism states that the global offer of wealth is a fixed amount, and therefore any profit of the wealth of one nation must necessarily represent another loss. Mercantilism is therefore the opposite of later capitalism Laissez-Faire supported by an economist, such as Adam Smith. This would be achieved by providing all the needs of their citizens in the domestic market and extraction of raw resources from the country itself or from the colonies and then completed in the country before their exports. In practice, this ideal could never actually exist, so mercantilism was engaged in trying to approach the ideal as possible.

In fact, there was no real cohesive theory of mercantilism over time, its ideals wouldLY ascending from the 16th to the 19th century. Different economic philosophers and government officials focused on different aspects of what is now called mercantilism, but only then began to form strong opposition, economists on the free market, such as Adam Smith, this term was described to describe different objectives. In retrospect, however, it is easy to see how different thinking fibers all worked on a similar ideal, and therefore it seemed to form free perpendicular mercantilism.

One of the main principles of mercantilism was that global economics was a zero -sum game: if one nation gained, another lost. This meant that it was essential to minimize capital exports and maximize capital permission. Thus, nations would eliminate the taxes and obstacles to trade in their own countries and increase the massive obstacles to all exports. It has also become an essential attempt to extract every ounce of raw resources on the domestic market and turn this raw source into finished products that could be exportedwith a hefty profit. If the raw materials were not immediately available, it was acceptable to import them, then finish them in the ground and export them for profit.

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colonies also played an import role in mercantilism as a constant source of raw resources and a captured market. Sources could be extracted from the colonies, sent to the parent country, worked into finished products and then sold back to the colony market, which would often have established laws that would provide favorable business treatment of the mother country over all other nations they want to trade. The export of capital brands, such as gold and silver, was particularly limited under Merkantiliambyl as a measure of the direct wealth of the nation.

Finally, the theory of mercantilism fell into disabling when the free market ideology became ascending. In the free market theory, the free and prepared goods trade was considered beneficial for all parties involved, while the global economy was considered an almost unlimited resource, rather notby a supported closed game with zero sum. Although some pockets of mercantilist thinking lasted until the beginning of the 20th century, in the mid -20th century it practically left all serious economists.