Melvyn Bragg and guests discuss how, between the 16th and 18th centuries, Europe was dominated by an economic way of thinking called mercantilism. The key idea was that exports should be as high as possible and imports minimised. For more than 300 years, almost every ruler and political thinker was a mercantilist. Eventually, economists including Adam Smith, in his ground-breaking work of 1776 The Wealth of Nations, declared that mercantilism was a flawed concept and it became discredited. However, a mercantilist economic approach can still be found in modern times and today’s politicians sometimes still use rhetoric related to mercantilism. With D’Maris Coffman Professor in Economics and Finance of the Built Environment at University College London Craig Muldrew Professor of Social and Economic History at the University of Cambridge and a Member of Queens’ College and Helen Paul, Lecturer in Economics and Economic History at the University of Southampton. Producer Luke Mulhall
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Between the 16th and 18th centuries, Europe was dominated by an economic way of thinking called mercantilism.
The key idea in mercantilism is that exports should be as high as possible and imports minimized.
For more than 300 years, almost every ruler and political thinker was a mercantilist.
Eventually, Adam Smith, in his groundbreaking work the wealth of nations and other economists, declared that it was a flawed concept and it became discredited.
However, a mercantilist economic approach can still be found in modern times, and today's politicians sometimes still use rhetoric related to mercantilism.
With me to discuss mercantilism are Damaris Kaufmande, professor in economics and finance of the built environment at University College London, Craig Muldru, professor of social and economic history at the University of Cambridge and a member of Queen's College, and Helen Paul, lecturer in economics and economic history at the University of Southampton.
Helen, in general, what type of policies do governments implement when they pursue mercantilism?
They try to restrict trade, so they do all kinds of things to increase exports and to decrease imports.
And that could be setting up a regulatory body like a board of trade trade.
It could be something like tariffs, it could be simply banning the export of bullion.
There are all sorts of things that they do to try to increase exports and decrease imports.
But haven't they been doing that all their lives?
What's new about this?
Well, I think the focus is on trying to have a restriction on imports and not paying any attention to what they might be used for.
So the luxury goods you could import, try to go without those, try to increase domestic production.