THE BIRTH OF THE POLITICAL ECONOMY OR THE ECONOMY IN THE HEART OF POLITICS: MERCANTILISM

Abstract

Mercantilism (16th–18th centuries) is a set of precepts concerning economic policy. It places the State at the heart of national economic development. Wealth is conceived as serving power. Mercantilists share a static conception of international economic relations, considering that one country can only enrich itself to the detriment of another. It is a true theory of economic war. However, the development of mercantilism shows a progressive transition of economic thought towards a lower consideration of political aspects.

Keywords:

• Mercantilism
• Power of the Prince
• War
• International trade

JEL Codes:

• B1
• B31

Notes

¹ Machiavelli already considered at the end of the 15th century that the power of the Prince is not an end in itself. The people need to have a sufficient welfare to respect the Prince.

² Thus, Colbert created large royal forests so that, two centuries later, military ships will have sufficiently high and solid masts.

³ See Bellais (1998).

⁴ On the contrary, for Thomas Mun and Antoine de Montchrestien, it was not desirable to reach abundance in the kingdom, as it would pervert the capacity of obedience and of sacrifice of the population.

⁵ Bodin's analysis is not contradictory in an international monetary system founded on the gold standard. Because of states' restrictions on trade, the quantitative theory applied only to the restrictive case of economic laissez‐faire.

⁶ Barthélemy Laffemas (1545–1611) was the tailor and the valet of Henri IV, then the general Controller of Trade in 1602 (Coulomb, 1998: 63 et seq.).

⁷ It was only at the end of the 17th century that Nicholas Barbon imposed an opposite view, according to which any trade was justified by itself.

⁸ These ideas will be taken up by the German historical school during the 19th century.