ECS3705
Assignment 1
Semester 2 2025
Due 25 September 2025
, ECS3705
Assignment 1
Semester 2 2025
Due 25 September 2025
QUESTION 1:
Having studied the Mercantilist school of thought, write a three-paragraph essay
discussing Mercantilist views on wealth creation, wealth stimulation, and the role of
government in the economy
The Mercantilist school of thought, which dominated European economic discourse
between the 16th and 18th centuries, conceptualized wealth primarily as the
accumulation of precious metals, particularly gold and silver, within a nation’s borders.
Central to Mercantilist doctrine was the belief that global wealth was finite and that a
nation could enhance its prosperity only by securing a favorable balance of trade.
Maximizing exports while minimizing imports was therefore seen as essential, as trade
surpluses ensured an inflow of bullion, the ultimate indicator of national power and
prosperity. Unlike later economic theories that highlighted production efficiency or
consumer welfare, Mercantilism regarded trade itself as the principal engine of wealth
creation. Consequently, nations were urged to strive for self-sufficiency in essential
goods while leveraging colonial resources to fuel domestic industries and sustain
economic expansion.
Wealth generation under Mercantilism was driven by assertive policies designed to
stimulate exports and suppress imports. Governments actively supported domestic
production through subsidies, state monopolies, and protective tariffs on foreign goods.
Colonization was promoted not only to secure raw materials but also to establish
captive markets for manufactured products. For example, the Navigation Acts and
related trade regulations ensured that colonial territories remained economically
dependent on the metropolitan center, thereby reinforcing a closed and self-serving
Assignment 1
Semester 2 2025
Due 25 September 2025
, ECS3705
Assignment 1
Semester 2 2025
Due 25 September 2025
QUESTION 1:
Having studied the Mercantilist school of thought, write a three-paragraph essay
discussing Mercantilist views on wealth creation, wealth stimulation, and the role of
government in the economy
The Mercantilist school of thought, which dominated European economic discourse
between the 16th and 18th centuries, conceptualized wealth primarily as the
accumulation of precious metals, particularly gold and silver, within a nation’s borders.
Central to Mercantilist doctrine was the belief that global wealth was finite and that a
nation could enhance its prosperity only by securing a favorable balance of trade.
Maximizing exports while minimizing imports was therefore seen as essential, as trade
surpluses ensured an inflow of bullion, the ultimate indicator of national power and
prosperity. Unlike later economic theories that highlighted production efficiency or
consumer welfare, Mercantilism regarded trade itself as the principal engine of wealth
creation. Consequently, nations were urged to strive for self-sufficiency in essential
goods while leveraging colonial resources to fuel domestic industries and sustain
economic expansion.
Wealth generation under Mercantilism was driven by assertive policies designed to
stimulate exports and suppress imports. Governments actively supported domestic
production through subsidies, state monopolies, and protective tariffs on foreign goods.
Colonization was promoted not only to secure raw materials but also to establish
captive markets for manufactured products. For example, the Navigation Acts and
related trade regulations ensured that colonial territories remained economically
dependent on the metropolitan center, thereby reinforcing a closed and self-serving
