Question

Discuss the main tenets of the mercantilist view of international economic relations. What kinds of foreign economic policies did mercantilists argue that states should pursue? please justify your answer.

Answer 1

Mercantilist were group of men who wrote essays and pamphlets on international trade. They advocated economic philosophy. According to them to become rich and powerful country should export more than it imported. The government’s job was to stimulate nation’s exports and discourage imports. But since all countries could not have export surplus simultaneously at a point of time and the amount of gold and silver was fixed, thereby only one nation could gain at the expense of the other nations. The measures of wealth was measured by the stock of precious metals it possessed. They promoted foreign economic policy of tariffs, quotas, monopoly priveledges granted to trading houses and infant industry protection.