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History of economic thoughts

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Steuart was one of the last representatives of the mercantilist school of economic thought.

Mercantilism was the school of thought that held that a positive balance of trade was of primary importance for any nation and required a ban on the export of gold and silver.

This theory led to high protective tariffs to maximize the use of domestic resources, colonial expansion and exclusivity of trade with those colonies.

British attempts to follow the mercantilist ideas led to the four Anglo-Dutch navigation wars and the American colonial’s wars of 1776-1781 and 1812.

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Britain adopted the high tariff, called the Corn Laws on all imported wheat at the suggestion of mercantilist advisors.

Debate over the Corn Laws would be harsh and would dominate the political discussion and occupy all British governments until the Corn Laws were repealed in 1846.

At the level of any individual sales transaction, mercantilism held that profit was developed at the point of the sale.

Steuart held that profit was a mere "surcharge" upon alienation (sale) of the commodity

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Thomas Mun:

Thomas Mun was English writer on economics who gave the first clear and vigorous statement of the theory of the balance of trade.

Mun came into public prominence in England during the economic depression of 1620.

Many people had blamed the East India Company for the economic downturn because the company financed its trade by exporting £30,000

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Mun was elected as the director of the company and set out to ensure that it was operating at full capacity.

In 1620, during the onset of the depression, Mun's role within the economy was greatly enhanced

He was forced to not only defend the East India Company and its practices, but also aid the government in correcting the economy.

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The trade crisis that eventually led to the depression stemmed from two separate events.

First, through the East India Company, England was importing from India at a much higher rate than it was exporting

Second, to pay for all of their imports, England sent precious metals to India.

Mun was thus put forward as a representative of the enterprise

He conveyed his views through his first published book, A Discourse of Trade from England Unto the East Indies.

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School Of Thought:Mun was one of the first mercantilists. In other words, he believed that a nation’s

holdings of gold are the main measure of its wealth and those governments should regulate trade to produce an excess of exports over imports in order to gain more gold for the country.

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Economic Polices: Imported goods that can be produced

domestically should be banned.Reduce luxurious imported goods by making

Englishmen have a taste for English goods.Reduce export duties on goods produced

domestically from foreign markets.If no alternatives are available to its neighbors,

England should charge more money for its exports.

Cultivate wasteland for higher production and to reduce the amount of imports needed from abroad.

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Publications

A Discourse of Trade from England Unto the East Indies (1621)

England's Treasure by Forraign Trade (1628)