Thomas Mun was a servant of the King of England according to his address to the king. His job was as a merchant and by his explanation it is clear that he had the responsibility for managing the king’s wealth. A search on the web turned up the fact that he was the head of the East India Company at a time when they were using quantities of silver to pay the Chinese for their goods[1].
The word mercantilism comes from the word merchant, which is defined as someone who buys and sells goods or services for profit according to the Merriam-Webster dictionary. Mercantilism was the name for the era of the times from 1600-1800, and when Kings were interested in maintaining their lands free from invasion by having a strong army. For this they needed gold or silver.
The word mercantilism comes from the word merchant, which is defined as someone who buys and sells goods or services for profit according to the Merriam-Webster dictionary. Mercantilism was the name for the era of the times from 1600-1800, and when Kings were interested in maintaining their lands free from invasion by having a strong army. For this they needed gold or silver.
The Photography above is of the CSS Acadia, used by the Canadian Hydrographic Service for Research Surveys along Eastern Canada and in Hudson Bay from 1913-1969. She's docked in Halifax, Nova Scotia.
Thomas Mun (1571-1641) explains the system by which the government’s officers taxed merchants and citizens to supplement the King’s treasury. He also describes how restrictions on imports and the export of surplus helped insure that a trade balance was held so that the King’s ledgers had a positive value. The payments i.e. the gold or silver wasn’t deemed as important as the trade in goods but he acknowledged that prices responded to the demand-supply curve and that money fluctuated based on each country’s relative wealth.
Thomas Mun thought that the King’s power came from how well he treated his countrymen and how the king was able to keep the populace happy i.e. low taxes and secure from invasion and at work getting paid. In order to pay for the overhead costs of running an army, the King needed more trade of exported goods and so less imports and expenditures to help justify low taxes.
My reaction to Thomas Mun’s work was wow, how cool that he understood a full market system at such an early date and that the government was fully cognizant of the available methods for taxing the population and working with merchants to finance the needs of the state. Later, after thinking about the model, it seems primitive in that it doesn’t examine the interactions that occur between states very well except from a point of advantage. It also shows the roots of colonialism in his explanation of monopolies in controlling access to the English market and the threats from competing societies for raw resources.
Who Was a Leading Anti-Mercantilist and Pre-Classical Theorist?
My answer is David Hume(1711-1776), because his “Political Discourses (1752) and Essays (1758) preceded the work of Adam Smith (1723-1790)[5]. Friedrich List ( came later, but his work “The National System of Political Economy” shows that he was doggedly anti-free trade, perceiving that until an economy had economic surplus available for trade that free trade tended to enslave the workers in an endless cycle of delivering resources in exchange for trade goods at a decided disadvantage[6]. Alexander Hamilton would have been very sympathetic to Friedrich List’s point of view since Hamilton protected US industries initially and imposed import restrictions. I believe that even Adam Smith would agree since he specifically speaks of the surplus goods to be traded and the necessity of protecting the nation.
[1] Thomas Mun, “Englands Treasure by Forraign Trade”, http://socserv2.socsci.mcmaster.ca/~econ/ugcm/3ll3/mun/treasure.txt
[5] History of Economic Thought, http://socserv2.socsci.mcmaster.ca/~econ/ugcm/3ll3/hume/index.html
[6] Friedrich List, National System of Political Economy, Chapter 34, http://www.econlib.org/library/YPDBooks/List/lstNPE34.html#Book IV, Chapter 34
[7] Hamilton’s Financial Plan, US History.org, http://www.ushistory.org/us/18b.asp
Thomas Mun thought that the King’s power came from how well he treated his countrymen and how the king was able to keep the populace happy i.e. low taxes and secure from invasion and at work getting paid. In order to pay for the overhead costs of running an army, the King needed more trade of exported goods and so less imports and expenditures to help justify low taxes.
My reaction to Thomas Mun’s work was wow, how cool that he understood a full market system at such an early date and that the government was fully cognizant of the available methods for taxing the population and working with merchants to finance the needs of the state. Later, after thinking about the model, it seems primitive in that it doesn’t examine the interactions that occur between states very well except from a point of advantage. It also shows the roots of colonialism in his explanation of monopolies in controlling access to the English market and the threats from competing societies for raw resources.
Who Was a Leading Anti-Mercantilist and Pre-Classical Theorist?
My answer is David Hume(1711-1776), because his “Political Discourses (1752) and Essays (1758) preceded the work of Adam Smith (1723-1790)[5]. Friedrich List ( came later, but his work “The National System of Political Economy” shows that he was doggedly anti-free trade, perceiving that until an economy had economic surplus available for trade that free trade tended to enslave the workers in an endless cycle of delivering resources in exchange for trade goods at a decided disadvantage[6]. Alexander Hamilton would have been very sympathetic to Friedrich List’s point of view since Hamilton protected US industries initially and imposed import restrictions. I believe that even Adam Smith would agree since he specifically speaks of the surplus goods to be traded and the necessity of protecting the nation.
[1] Thomas Mun, “Englands Treasure by Forraign Trade”, http://socserv2.socsci.mcmaster.ca/~econ/ugcm/3ll3/mun/treasure.txt
[5] History of Economic Thought, http://socserv2.socsci.mcmaster.ca/~econ/ugcm/3ll3/hume/index.html
[6] Friedrich List, National System of Political Economy, Chapter 34, http://www.econlib.org/library/YPDBooks/List/lstNPE34.html#Book IV, Chapter 34
[7] Hamilton’s Financial Plan, US History.org, http://www.ushistory.org/us/18b.asp
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