What is mercantilism?

Mercantilism is a term that comes from Latin and is equivalent in parts to the words "trade" and "system". For this reason, the concept of commercialism finds its meaning in that economic system whose two fundamental pillars are trade and export.

In order to delve into the definition of mercantilism, it is important to bear in mind that the thinking that promotes this doctrine finds its main axis in the State, as the engine of the economy and the development of a country. Also, this economic term refers to all those measures that are taken by a government with the intention of protecting its own economy, that is, it is a theory that favors the country's own and internal production.

What are the characteristics of mercantilism?

Issues such as the control of precious metals are the maxims of commercialism, since the countries that were governed by this type of measures were totally prohibited from engaging in the export of these metals.

Precisely for this reason, the main characteristic of mercantilism is that in foreign markets it constantly seeks to obtain coins and metals that guarantee its wealth and therefore its economic viability.

It is also worth highlighting the implication of mercantilism in terms of balance of trade It is concerned, since every mercantilist state had to ensure that exports were lower than imports. For all these reasons, the State would always try to control the currency so that payments were positive at all times.

What objectives does mercantilism pursue?

Mercantilism at the political level holds a main idea on which all its actions are based. This theory assumes that the country that is richest in metal will have a superior economy. This was the political situation that existed until the XNUMXth century, but progressively these theories promoted by this system were being replaced by the most liberal thought and measures. Therefore, the objectives of mercantilism are the following:

  • The State is the one that must watch over the wealth of a country and for this it will always establish measures considered as protectionist.
  • In a mercantile market, exports they must be higher than imports.

These are the key ideas of mercantilism but we also find other highly relevant factors. In mercantilism, in order to improve a country's trade and economy, the State will always be in charge of creating companies faithful to its cause.

The most important precursors of mercantilism

Among the most important mercantilist schools we find bullonismo in the first place. Bullonismo, an unparalleled accumulator of precious metals that, to protect itself from inflation, made use of these materials against the currency, therefore, the complete opposite of the free market.

Second, we would find French mercantilism, better known as Colbertism, due to its main predecessor, Jean-Baptiste Colbert Contrôleur. This type of economic doctrine what he proposed was a set of protectionist measures together with economic industrialization.

The actuality of mercantilism is marked by certain outbreaks that we can observe, for example, in Japan, with its protectionist measures for agriculture, but the truth is that in the midst of globalization it is not so common to see this type of measure. However, politicians like Donald Trump have recovered these theories.

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