Mercantilism

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Did mercantilism accept the intervention of government

The colonies should give their profits to England

The theory of mercantilism is described best as England giving economic favors. these favors were given to some companies and people but not others.

the value of exports is greater than the value of imports

wealth

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Each colony would provide raw materials to England and this would allow the nation to not have to purchase that product from another nation. By establishing colonies loyal to the Crown, Great Britain would be expanding a dependable market for the finished products coming out of British industries. The colonies would always have a market for their goods, and could buy British products from their industry at a lower cost.

the amount of gold, silver, and tradable manufactured goods it controlled.

Governments needed greater control over the colonies to acquire wealth. - Apex

They also needed more cheese for their world record cheese wheel.

New England had many products/goods that England didn't have. If they traded with other places, they would become richer because they would sell them for a cheaper price than England.

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The British system of mercantilism was opposed by many American colonists because it?

they had tasted economic independence for too long of a period just to sink back to british mercantilism policies

Early theories of trade such as mercantilism view trade as a zero sum gum. They focused on theories of nation building which can be done only through at the expense of other countries. So export must be in excess of import. They measure the wealth of nation by the amount of bullion the country accumulate/has. For them the country is reach only if she accumulates precious metals such as Gold and Silver. This idea is an imperialistic and ignores the process of mutual gains and relation between countries. They fail to explain the dynamics of international trade and highly shortsighted.

As a critics to mercantilism classical economists such as Adam Smith, David Ricardo, Johan Stuart Mill emerged explaining the importance of trade for all participating countries. According to them trade leads to a win-win outcome. According to Smith trade increases country's capacity to produce which was constrained by limited domestic market. He developed the theory of absolute advantage which states if a country is better in the production of one of the goods and the other country by another good they have a mutual beneficial trade. Ricardo expanded this theory to the concept of comparative advantage which is explained in terms of opportunity cost. There theory mainly rely on the existence of factors of production. Country's gain because they have different factors of competitiveness. trade arise between countries because they have different resource endowment. sources of competitiveness for them was based on land, natural resources, labor, population etc.

However according to Michael porter these theories are no longer important. For him factors necessary for competitiveness are not inherited rather they are made. It is competitiveness that matters for survival in international trade but not mere existence of resource. Based on his argument the failure of African economies not to develop factors necessary for competition and reliance on primary product contributed towards the sluggish performance of their economies. unskilled labor, land and other resources are natural and their usefulness for competition is very decimal. So what is important? According to porter to be competitive a nation need to develop skilled labor, technology, infrastructure etc.

A firms competitiveness at national and global market depends on five factors at which a strategic policy maker must decide up on. These are rivalries between firms, buyers power, suppliers power, barriers to entry and threats of substitutes.

Mercantilism, The economic system of the major trading nations during the 16th, 17th, and 18th cent., based on the premise that national wealth and power were best served by increasing exports and collecting precious metals in return. It superseded the medieval feudal organization in Western Europe, especially in Holland, France, and England. The period 16-17th century was one of religious and commercial wars, and large revenues were needed to maintain armies and pay the growing costs of civil government. Mercantilist nations were impressed by the fact that the precious metals, especially gold, were in universal demand as the ready means of obtaining other commodities; hence they tended to identify money with wealth. As the best means of acquiring bullion, foreign trade was favored above domestic trade, and manufacturing or processing, which provided the goods for foreign trade, was favored at the expense of the extractive industries (e.g., agriculture). State action, an essential feature of the mercantile system, was used to accomplish its purposes. Under a mercantilist policy a nation sought to sell more than it bought so as to accumulate bullion. Besides bullion, raw materials for domestic manufacturers were also sought, and duties were levied on the importation of such goods in order to provide revenue for the government. The state exercised much control over economic life, chiefly through corporations and trading companies. Production was carefully regulated with the object of securing goods of high quality and low cost, thus enabling the nation to hold its place in foreign markets. Treaties were made to obtain exclusive trading privileges, and the commerce of colonies was exploited for the benefit of the mother country. In England mercantilist policies were effective in creating a skilled industrial population and a large shipping industry. Through a series of Navigation Acts, in English history, name given to certain parliamentary legislation, more properly called the British Acts of Trade. The acts were an outgrowth of mercantilism , and followed principles laid down by Tudor and early Stuart trade regulations.

England finally destroyed the commerce of Holland, its chief rival. As the classical economists were later to point out, however, even a successful mercantilist policy was not likely to be beneficial, because it produced an oversupply of money and, with it, serious inflation. Mercantilist ideas did not decline until the coming of the Industrial Revolution.

Henry VIII, Elizabeth I, and Oliver Cromwell conformed their policies to mercantilism. In France its chief exponent was Jean Baptiste Colbert.

They believe in the use of colonies for the benefit of the mother country, otherwise they tip the trade so it benefits the mother country.

Protectionism and regulation are the best ways to keep nations prosperous.

Their activities were to benefit only the mother country.

the answer is C if you are on castle learning

During the period of exploration and colonization, all the major powers were mercantilist nations. The object of mercantilism was to minimize imports that cost the nation money, and maximize exports that made the nation money. Colonies were a means of reducing a country's dependence on foreign nations. Each colony would provide a raw material to the Mother Country and this would allow the nation to not have to purchase that product from another nation. The object was to sell more than you bought.

According to mercantilism, the colonies were required to engage in two general behaviors: (1) The colonies were locked into exclusive trade between the colonies and the metropole and were not allowed to trade with any other nation or colony. (2) No manufactures or complex goods could be made in the colonial territory. As a result the colonies would provide wealth to the metropole by trading their natural resources for less than they would be worth and by buying manufactures for much more money.

The basic beliefs of Mercantilism included that wealth of a nation came mostly from its possession of gold and silver.

Mercantilism is defined as being the economic policy or theory in which a country sets up a colony or several colonies, like Spain did in Latin America or Britain in North America, for the sole reason of the economic gain of the mother country. IN other words, the only reason a mercantilistic country would set up a colony was for the economic prosperity of the mother country through the natural resources and manual labor gotten in the colony.

Mercantilism gave the colonies a reliable market for some of their raw materials and an eager supplier of the manufactured goods they needed. However, it prevented them from selling goods to other nations, even if they could get a better price. Also, if a colony produced nothing the home country needed, the colony could not acquire gold or silver to buy manufactured goods.