Mercantilism

Mercantilism is an economic system and type of nationalist economic policy that is designed to maximize exports and minimize imports of an economy. It seeks to maximize the accumulation of resources within the country and use those resources for one-sided trade. Mercantilist policies have contributed to armed conflict and motivated colonial expansion. Economic intervention – especially in industrializing countries – is seen as modern mercantilism. Within economic planning, the concept aims to reduce a possible current account deficit or reach a current account surplus, and it includes measures aimed at accumulating monetary reserves by a positive balance of trade, especially of finished goods. Mercantilism promotes government regulation of a nation's economy for the purpose of augmenting and bolstering state power at the expense of rival national powers. Throughout history, high tariffs, especially on manufactured goods, were almost universally a feature of mercantilist policy. Mercantilism was dominant in modernized parts of Europe and some areas in Africa from the 16th to the 19th centuries, a period of proto-industrialization. International trade treaties and groups have led to the advent of non-tariff barriers to trade which have culminated to produce neomercantilism.