Mercantilism Lives
5th April 2011
When I studied economics in college, I learned that mercantilism supplanted feudalism to become the predominant economic doctrine through the late Middle Ages. Mercantilism, “economic nationalism for the purpose of building a wealthy and powerful state,” is based on this logic: “The richer the nation, the stronger the nation; the stronger the nation, the better for every member of that kingdom.” It wasn’t until the 17th century that mercantilism was seriously challenged, and Adam Smith finally drove a stake through its heart when he published The Wealth of Nations 235 years ago. Perhaps most economists hold this clean view of history, but it seems that the rest of the world never got the memo. Unfortunately, the archaic and counterproductive ideas of mercantilism are alive and kicking in 21st-century America.
No bad idea ever truly dies.