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That's how adaptation of classical notions to the modern world looks like.

Indeed, mercantilism means sustaining trade surplus, but usually with a naked purpose to capturing more wealth.

Mercantilism as a whole cannot be considered a unified theory of economics because mercantilism has traditionally been driven more by the political and commercial interests of the State and security concerns than by abstract ideas. There were no mercantilist writers presenting an overarching scheme for the ideal economy... Rather, each mercantilist writer tended to focus on a single area of the economy... Smith saw the mercantile system as an enormous conspiracy by manufacturers and merchants against consumers, a view that has led some authors... to call mercantilism "a rent-seeking society"... Mercantilists viewed the economic system as a zero-sum game, in which any gain by one party required a loss by another. Thus... there was no possibility of economics being used to maximize the "commonwealth", or common good. Mercantilists' writings were also generally created to rationalize particular practices rather than as investigations into the best policies.

The modern Asian "mercantilism" is hardly grounded by self-interest analysis. The method is rather forced by the global system; the pressing question becomes "What does a country have to do (to appear nice)?" rather than "What does a country want?" The center of "rent-seeking" is somewhere completely else.

by das monde on Fri Oct 17th, 2008 at 05:38:52 AM EST
[ Parent ]
... the focus is not on the capture of the silver to use to buy into the carrying trade in East Asia, as in Europe in the 1700's, but rather on the finance of exports in order to generate employment.

A trade surplus is still being targeted, but the cause-effect has been inverted ... rather than pursuing a trade surplus in order to acquire foreign exchange (precious metals at the time), external exchange is acquired in order to depress exchange rates in order to achieve a trade surplus.

"Neo" often means "not exactly, but obliquely".


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Fri Oct 17th, 2008 at 02:57:57 PM EST
[ Parent ]

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