What is the Main Idea of Mercantilism?
By BYJU'S Exam Prep
Updated on: November 9th, 2023
The Main Idea of Mercantilism is that boosting exports and commerce benefits a country’s strength and riches. It was an economic philosophy and policy that European colonial empires pursued. The primary notion of mercantilism is that the amount of wealth in the globe remains largely steady. A country’s wealth is best measured by the amount of precious metal it possesses. To obtain precious metals, a favorable trade balance must be achieved by encouraging exports rather than imports.
Table of content
Main Idea of Mercantilism
Mercantilism is an economic policy that aims to boost an economy’s exports while decreasing its imports. It was an economic policy that gave rise to European colonialism and empire. The Sugar Act of 1764, which obliged American colonists to pay hefty customs and charges on foreign refined sugar product imports, was an example of mercantilism.
Characteristics of Mercantilism
The five characteristics of mercantilism are as follows:
- Accumulation of wealth and power
- The belief that wealth is static. This was the core belief of mercantilism
- Establishment of monopolies on certain trade items
- Trade barriers
- Positive trade balance.
Summary:
What is the Main Idea of Mercantilism?
The core idea of mercantilism is that the wealth and power of a country are best served by increasing exports and trade. It was an economic principle and policy followed by the European colonial empires.
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