List of Top 6 Mercantilists

List of top ten mercantilists who influenced the economic policy:- 1. Antonio Serra 2. Sir Thomas Mun 3. Sir Josiah Child 4. Philipp Von Hornick 5. Johannes Nejnrich Gottleb Von’ Justi 6. Joachim George Daries.

Mercantilist # 1. Antonio Serra:

Antonio Serra was an Italian. His pamphlet, “A Brief Treatise on the causes which can make Gold and Silver abound in Kingdoms where there are no Mines”, contains his mercantilist views. There are some countries blessed with gold and silver mines.

But in other countries, according to Serra, the presence of gold and silver may be attributed to:

(1) The quantity of industry,

(2) The quantity of the population,

(3) Extensive trading operation, and

(4) The regulations of the sovereign.

(i) The Quantity of Industry:

This is the typical Mercantilist idea of preferring industry to agriculture, because, according to him, firstly, it is safer, as the cultivator of land has to depend on weather, secondly, it is subject to increasing returns whereas agriculture is not, thirdly, it has a surer market, because fruits of industry can be kept for a long time to secure a better market and fourthly, and lastly, there is more profit in industry than in agriculture.

(ii) The Quality of Population:

The more diligent, hard-working and eager to build up the trade are the inhabitants of a country, the more beneficial it will be to develop foreign trade and thereby get more gold and silver.

(iii) Extensive Trading Operations:

The country should possess an extensive trade and trading operations preferably in the produce of foreign countries rather than that of its own.

(iv) Regulations of the Sovereign:

Here Serra is somewhat feeble because, according to him, it is not easy to know how to arrange this factor well since the same case may produce different effects in different cases just like a light whistle rouses the dogs but quiets the horses. Any way the trend is clear.

Like Thomas Mun, Serra also disapproves the prohibition of the export of money. According to him, if money is exported for any purpose whatever, it must return with profit into the kingdom from which it was sent. But this goes to the root of the Mercantilist idea.

Mercantilist # 2. Sir Thomas Mun:

Mun was an important representative of the English mercantilists. He was born in England in 1571. His most important book was “England’s Treasure by Foreign Trade”. Gray rightly remarks that “Mun is perhaps the nearest approach to the perfect mercantilist”.

Mun wanted to regulate the foreign trade of the country to secure a favourable balance of trade. He stated his theory of balance of trade thus: “The ordinary means to increase our wealth and treasure is by foreign trade, wherein we must ever observe this rule: to sell more to strangers yearly than we consume of theirs in value”.

He never wanted to place restrictions on the export of billion. But he wanted to manufacture commodities at home “for then we get not only the price of our wares as they are worth here, but also the merchants’ gains, the charges of insurance and freight to carry them beyond the seas”.

He advocated accumulation of wealth and it could be possible by reducing imports and encouraging exports. He suggested that imports should be taxed at a high rate and exports at a moderate rate. He did not want limitless accumulation of wealth because it would lead to high prices and adverse balance of trade. He also recognised the importance of taxation for national defence.

In his book, he has suggested a programme for accumulation of treasure. The main points of this programme were:

1. Mun advocated the cultivation of waste lands for producing those commodities which were hitherto imported. This would help in reducing the import of tobacco, hemp, flax etc.

2. He suggested that people should refrain from consuming foreign goods and from unnecessary change of fashions, so that their imports might be reduced.

3. Regarding exports, the requirements of neighbouring countries should be properly assessed so that the commodities which a foreign buyer could not get from other places might be sold at a higher price. As for other goods, they might be sold at a cheaper rate.

4. Commodities should be transported only through England’s own ships so that price of the commodities and shipping charges might be available to the state.

5. He advocated frugal consumption of domestic goods by English people so that more would be left for exports. Lavish consumption of domestic goods would promote employment of poor.

6. Mun suggested that English people should develop fishing in adjacent seas instead of allowing Dutch to fish in those waters.

7. England should be developed into a distributing centre so that shipping and trade could develop and the King’s income might increase.

8. Mun wanted England to have trade relations with distant countries.

9. He favoured the export of money to other countries for he thought “money begets trade and trade increases money”. Mere accumulation of money in the country will not lead to a quick and ample development of trade.

10. He wanted that the commodities manufactured from the imported material should be allowed to be exported free. By this measure England would be able to provide employment and increase exports and the customs of the King.

11. “We must endeavour to make the most we can of our own”. This statement of Mun is very vague and he did not try to elucidate it.

Mun praised industry and condemned idleness and luxury. He praised the “industrious Dutch” and deplored the idleness of his countrymen who spent most of their time in idleness and pleasure smoking, feasting and drinking. Mun was also aware of the fact that money was only a means to an end and that it would not serve its purpose if enough goods and services were not there to buy. He was aware of the fact that money by itself was barren.

Mercantilist # 3. Sir Josiah Child:

Sir Josiah Child (1630-1699) favoured a surplus balance of trade and supported an export of specie if it could result in a greater eventual inflow of it. To him international trade could not be un-directional and some imports were bound to be there. Like Mun he also insisted that a nation should direct its attention to the general rather than particular trade balance.

Sir Child’s main contribution, however, was in terms of the relationships between rate of interest and flourishing trade and commerce. He believed that a low rate of interest encouraged expansion of trade and therefore strongly advocated for it. He supported his argument by stressing that Holland was ahead of England in trade primarily on account of the low rate of interest there.

Child developed a theory of colonial economy and linked it to argument of employment at home. Colonialism implied emigration from the home country which in itself was bad. But Child found that in some cases this emigration might also create additional demand abroad for imports from the home country in which case home workers could be employed more beneficially. Thus the usefulness or otherwise of colonies depended upon the nature of individual colonies.

Mercantilist # 4. Philipp Von Hornick (1638-1712):

Von Hornick was an Austrian pamphleteer. According to him, “The might and eminence of a country consists in its surplus of gold and silver”. All other things necessary or convenient for its subsistence should be derived from its own resources without dependence on other countries. Like Mun, Hornick has laid down certain rules for the accumulation of gold and silver.

(i) The country’s soil should be exploited to the utmost and in particular, efforts should be made to discover gold and silver;

(ii) The commodities should be worked up in the country itself;

(iii) Population should be encouraged and the people turned from idleness;

(iv) Gold and silver should not be allowed to be exported or hoarded but should remain in circulation;

(v) The people should get along with their own domestic products and foreign products should be avoided as far as possible;

(vi) When it becomes absolutely necessary to obtain foreign products, this should be done by exchange with internal goods and not by gold and silver;

(vii) As far as possible the foreign goods should be imported in unfinished form and worked up in the country;

(viii) In so far as exports are concerned these should be sold in a finished form as far as possible and only in exchange with gold and silver;

(ix) Mo import should be allowed of goods of which there is sufficient supply in the country even if it is of a lightly inferior quality.

His fundamental doctrine is that it is better to pay more for an article which remains in the country than one which goes out because, according to him, “What once goes out stays out”. The question with him is always one of foreign comparison since, according to him, the power and wealth have become relative terms, depending not on the absolute quantities of power and wealth possessed but in their relations to those of neighbouring lands. He, therefore, wants that his country, i.e., Austria, should surpass her neighbours in power and wealth by the application of various devices. This is a quite typical Mercantilist idea.

Mercantilist # 5. Johannes Nejnrich Gottleb Von’ Justi (1717-1771):

Justi was a professor of Kameral Sciences at the University of Vienna. He was a great author. His views are contained in his book entitled “Political Economy, or a Systematic Treatise on all Economic and Kameral Sciences” which was published in 1755. In this book he has summed up the Kameralistic doctrines. There is nothing new except the analysis and classifications made by him.

According to him, economic science deals with the maintenance and increase of resources of private persons while the Kameral Science deals with similar subjects in relation to governments. Kameralism is demonstrated in nature and deals with the revenue of the prince, its disbursement, organization and administration of the political business of the prince.

He says that there are three great essentials leading to the prosperity of the State; freedom, safety of property rights and flourishing industry. Good government and flourishing industry and limitless increase of population may increase the wealth of a State to any extent. Although he attaches great significance to commerce and favourable balance of trade, he does not undermine the importance of agriculture.

Justi has laid down certain rules for the imposition of taxes. In brief, these rules are:

(i) Taxes should be so levied that they will be willingly paid.

(ii) They must not obstruct the progress of industry and commerce by coming in the way of freedom of conduct, credit, etc.

(iii) They must be imposed with relative equality.

(iv) They should be certain and true, and imposed upon such articles which may lead to a sure and honest collection.

(v) They should be imposed on such commodities, that their collection will require the minimum number of officers and officials.

(vi) They should be levied in such a way that the time and amount of payment would be most convenient for the people.

Mercantilist # 6. Joachim George Daries (1714 — 1791):

Daries was a professor at the University of Jena. In 1763 he became professor of Kameral Sciences at the University of Frankfurt where he founded the Royal Academy. He wrote a book entitled “First Principles of Kameral Sciences” which was published in 1756. In this book he has tried to remove the objections raised against Kameralism. According to him there are two sources of annual income one fixed and the other, a matter of chance.

The former consists of:

(a) Aptness in application of human force; and

(b) Acquired goods which can be of annual use.

This he calls capital and to him capital is a surer source of income than a skill. His definition of capital is quite interesting. To him it is “that earned property which we accept as enduring so that it proves effective annually for our uses”.

Daries divided Kameralism into rural and urban. The former deals with the forces of nature and includes tillage and cattle rearing. The latter includes the art which helps nature in workshops and factories. The third division is that of Police Science or Polity which treats of matters as population, education, and care of the poor, etc. Lastly, there is Royal Economy, which relates to the royal income.

The analysis of costs as given by Daries is worth noting.

He says that the producers should make a thorough investigation of costs and make allowance for:

(a) Raw materials;

(b) Interest on the value of such materials till the finished product is sold out;

(c) The price of tools;

(d) Interest on their value and their depreciation;

(e) Labour;

(f) Interest on wages;

(g) Interest on the value of buildings used; and

(h) Expenses involved in marketing, accounting, etc.

In the ultimate analysis, he is of the opinion that “when these items are established as a capital and the price received for the product replaces this capital with interest, the business is carried on with profit”. He does not favour the idea of completely banning the export of gold and silver.

“The export of gold and silver is only to be obstructed to the extent that it does not work to the good of the State. It is, on the contrary, an evidence of political shrewdness to give foreigners gold and silver if it is possible by this to further the well-being of the State”.

He was opposed to the idea of imposing restrictions on trade. According to him it is not always profitable to exchange goods for precious metals. He considers the exchange of goods for goods under certain circumstances, more advantageous.

He was an orthodox Mercantilist in so far as he supported the idea of an increasing population. According to him a dense population is the source of wealth to the State. It increases the food supply, trade and income of the prince and is important for defence.