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 Theories of development economics

Mercantilism

World GDP per capita, from 1400 to 2003 A.D.

 The earliest Western theor of development economics !as mercantilism, !hich

developed in the 1"th cent#r, parallelin$ the rise of the nation state. %arlier

theories had $iven little attention to development. &or e'ample, (cholasticism the

dominant school of tho#$ht d#rin$ medieval fe#dalism, emphasi)ed reconciliation

!ith *hristian theolo$ and ethics, rather than development. The 1+th and 1"th

cent#r (chool of (alamanca, credited as the earliest modern school of economics,

li-e!ise did not address development specicall.

Ma/or %#ropean nations in the 1"th and 1th cent#r all adopted mercantilist ideals

to varin$ de$rees, the in#ence onl ein$ !ith the 1thcent#r development

of phsiocrats in &rance and classical economics in ritain. Mercantilism held that anations prosperit depended on its s#ppl of capital, represented #llion 5$old,

silver, and trade val#e6 held the state. 7t emphasised the maintenance of a hi$h

positive trade alance 5ma'imisin$ e'ports and minimisin$ imports6 as a means of

acc#m#latin$ this #llion. To achieve a positive trade alance, protectionist

meas#res s#ch as tari8s and s#sidies to home ind#stries !ere advocated.

Mercantilist development theor also advocated colonialism.

 Theorists most associated !ith mercantilism incl#de Philipp Wilhelm von 9ornic-,

!ho in his Austria Over All, If She Only Will of 1+4 $ave the onl comprehensivestatement of mercantilist theor, emphasi)in$ prod#ction and an e'portled

econom.:"; 7n &rance, mercantilist polic is most associated !ith 1"thcent#rnance minister 

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%conomic nationalism

Ale'ander 9amilton, credited as &ather of the =ational (stem.

&ollo!in$ mercantilism !as the related theor of economic nationalism,

prom#l$ated in the 1>th cent#r related to the development and ind#striali)ation of the ?nited (tates and German, notal in the policies of the American (stem in

America and the @ollverein 5c#stoms #nion6 in German. A si$nicant di8erence

from mercantilism !as the deemphasis on colonies, in favor of a foc#s on domestic

prod#ction.

 The names most associated !ith 1>thcent#r economic nationalism are the

American Ale'ander 9amilton, the GermanAmerican &riedrich ist, and the

American 9enr *la. 9amiltons 1">1 Report on Manufactures, his ma$n#m op#s,is the fo#ndin$ te't of the American (stem, and dre! from the mercantilist

economies of ritain #nder %li)aeth 7 and &rance #nder *olert. ists 141 Das

Nationale System der Politischen Öonomie 5translated into %n$lish as The =ational(stem of Political %conom6, !hich emphasi)ed sta$es of $ro!th, proved in#ential

in the ?( and German, and nationalist policies !ere p#rs#ed politician 9enr

*la, and later Araham incoln, #nder the in#ence of economist 9enr *harles

*are.

&orms of economic nationalism and neomercantilism have also een -e in th and 20th cent#ries, and the more recent development of

the&o#r Asian Ti$ers 59on$ Bon$, (o#th Borea, Tai!an, and (in$apore6, and, most

si$nicantl, *hina.

(o#rceC !i-ipedia.or$

http://en.wikipedia.org/wiki/Alexander_Hamiltonhttp://en.wikipedia.org/wiki/Economic_nationalismhttp://en.wikipedia.org/wiki/American_School_(economics)http://en.wikipedia.org/wiki/Zollvereinhttp://en.wikipedia.org/wiki/Alexander_Hamiltonhttp://en.wikipedia.org/wiki/Friedrich_Listhttp://en.wikipedia.org/wiki/Henry_Clayhttp://en.wikipedia.org/wiki/Report_on_Manufactureshttp://en.wikipedia.org/wiki/Henry_Clayhttp://en.wikipedia.org/wiki/Henry_Clayhttp://en.wikipedia.org/wiki/Abraham_Lincolnhttp://en.wikipedia.org/wiki/Henry_Charles_Careyhttp://en.wikipedia.org/wiki/Henry_Charles_Careyhttp://en.wikipedia.org/wiki/Four_Asian_Tigershttp://en.wikipedia.org/wiki/Alexander_Hamiltonhttp://en.wikipedia.org/wiki/Economic_nationalismhttp://en.wikipedia.org/wiki/American_School_(economics)http://en.wikipedia.org/wiki/Zollvereinhttp://en.wikipedia.org/wiki/Alexander_Hamiltonhttp://en.wikipedia.org/wiki/Friedrich_Listhttp://en.wikipedia.org/wiki/Henry_Clayhttp://en.wikipedia.org/wiki/Report_on_Manufactureshttp://en.wikipedia.org/wiki/Henry_Clayhttp://en.wikipedia.org/wiki/Henry_Clayhttp://en.wikipedia.org/wiki/Abraham_Lincolnhttp://en.wikipedia.org/wiki/Henry_Charles_Careyhttp://en.wikipedia.org/wiki/Henry_Charles_Careyhttp://en.wikipedia.org/wiki/Four_Asian_Tigers