Mercantilism or Mercantile Ideology

Mercantilism or Mercantile Ideology

Mercantilism or Mercantile Ideology

Mercantilism is a system based on mutual dependence between state and commercial interests. National good and merchant profits were considered as two sides of the same coin. The strength of the mercantile system depended upon changing laws, customs, philosophies, and roles of social institutions. The more important aspects of mercantile ideology were:

Importance of money: The identification of money with wealth. Accumulation of treasure in the form of hoards of precious metal and money was nothing new to the mercantile period. Mercantile philosophy expanded the concept of wealth and power to the nation as accumulating a hoard of national treasure.

Importance of central government: National economic power depended upon the unification of political power a centralized political unit strong enough to impose and enforce a uniform set of commercial laws, uniform tariffs, and a uniform monetary system.

Protection and state intervention: Economic activity only by receiving a monopoly from the crown. The whole philosophy of the mercantile system was challenged and emphasis shifted from the state. The state-controlled all business and one could engage in a particular intervention to state protection. State intervention first the country was to produce all its own foodstuff and manufactured articles. Second, the country was to control its own merchant shipping. Third, produced raw materials & absorbed surpluses of manufactured goods.

Power: The key to economic super money under mercantilism was power. Military power was necessary to obtain & bold foreign markets & to protect shipping. State power, in turn, depended upon economic activity to provide the money necessary to protect commerce, enforce laws and tight wars.

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