Tuesday, March 24, 2009

the role of government (1)

The economic policies pursued by the mercantilism followed from these basic doctrine governments controlled the use and exchange of precious metals,what is often referred to as bullion ism .In particular ,countries attempted to prohibit the export of gold ,silver ,and other precious metals by individuals ,and rulers let specie leave the country only out of necessity .Individuals caught smuggling specie were subject to swift punishment ,often death.government also gave exclusive trading rights for certain routes or areas to specific companies. trade monopolies fostered the generation of the higher profits contributed both directly and indirectly to a positive trade balance and to the wealth of the rulers who shared the profits of this activity .The Hudson Bay Company and the dutch East India Trading company are familiar examples of trade monopolies ,some of which continued well into the nineteenth century.

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