The command Economy Research Paper

The command Economy Research Paper

Instructions/Descriptions

The command Economy Research Paper

Mercantilism played a major role in the exploration and discovery by European powers in the late 15th and 16th centuries. It is important to note that it is a type of command economy. In a command economy, it is based on state controls. As such, the government decides what, how much, how to, and who are the consumers.

Contrary, to a market economy, a command has a central authority while the market economy is based on decisions made by individuals. Around the 1600s, since most of Europe were monarchies, it mostly leaned on the notion of a command economy. Mercantilism was in fact incredibly popular throughout Europe during that time. However, mercantilism was not just popular due to the notions and system it provides to its states alone.

Historically, mercantilism was known as an economic theory in which expresses the notion that trade generates wealth. It asserts that it is stimulated by the accumulation of profitable balance. This is something in which a state’s government was encouraged to secure.

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Many European powers from the late 15th and 16th centuries used protectionism, a practice of utilizing trade policies that allows the government or head of state to promote domestic producers. This way, through imposing tariffs or limiting foreign products and services in the marketplace, it would consequently boost the country’s domestic production of goods and services.

Though in practice this seems reasonable, mercantilism was actually often used as a logical excuse for expansionism. Great powers like England, Spain, and France would manipulate and use its concept as a way to justify their need to imperialistically expand their borders and gain more territory through conquest and colonization.

As a system of both political and economic policy, mercantilism now essentially seeks to secure a state’s political and economic supremacy in its rivalry with other states. The goal of each state was to accumulate important natural resources and metals through the exportation of the largest quantity of products and conversely importing as little as possible.

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Only then would a “favorable balance of trade” be established. National wealth is measured in the amount of precious metals or resources like gold and silver. For mercantilists, they believe that wealth is finite, that there is a limit to how much silver or gold one can obtain. Hence the reason why there was once such a race and urgency to colonize new land.

With more land, there are more resources, a greater chance to expand one’s wealth. In this context, it is similar to the notion of a zero-sum game. Since resources are finite, there is only so much available. If a state wants more resources to generate more wealth and power they would either have to colonize more land or take some by force.

Also explain how African slavery became vital to the New World.

The command Economy Research Paper

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