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https://www.thebalancemoney.com/mercantilism-definition-examples-significance-today-4163347

Mercantilism, a historical economic system focused on national wealth accumulation through trade surpluses and state intervention, contrasts with capitalism, which emphasizes private ownership, free markets, and profit-driven production.

Mercantilism

National wealth and power through trade surpluses, accumulating precious metals, and government control of the economy.

Key Principles:

Positive balance of trade: Exporting more than importing to accumulate wealth.

Accumulation of precious metals: Gold and silver were seen as the primary indicators of national wealth.

Government intervention: Strong state control over trade, industry, and the economy.

Protectionist policies: Tariffs, quotas, and other measures to protect domestic industries.

Historical Context:

Predominant economic system in Europe from the 16th to 18th centuries.

Examples:

European powers' colonial policies, where colonies provided raw materials and served as markets for manufactured goods.

Capitalism

Private ownership of the means of production, free markets, and profit maximization.

Key Principles:

Private ownership: Individuals and businesses own and control the means of production (land, labor, capital).

Free markets: Prices and production are determined by supply and demand, with minimal government intervention.

Profit motive: Businesses are driven by the pursuit of profit.

Competition: Businesses compete with each other to attract customers and earn profits.

Historical Context:

Emerged as a dominant economic system in the 18th century, with roots in the decline of mercantilism.

Examples:

Modern economies where private companies produce goods and services for profit, with minimal government intervention.