ECS3705
Assessment 1
Semester 2 2025
Due September 2025
, ECS3705
Assessment 1
Semester 2 2025
Due 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.
Mercantilists conceptualized wealth creation as the accumulation of precious metals,
especially gold and silver, which they considered the ultimate measure of a nation’s
prosperity. They viewed wealth as finite, embracing a zero-sum logic whereby one
nation’s gain inevitably came at another’s expense. To expand national wealth,
mercantilists emphasized achieving a trade surplus, exporting more than importing, and
thereby drawing bullion from foreign economies into the domestic treasury. This
emphasis on bullionism tied national strength to the amassing of reserves, with
manufactured exports prioritized over raw material imports. Colonies were exploited to
provide cheap resources, while individual enrichment was subordinated to the collective
wealth of the state. However, critics argue that this narrow fixation on bullion overlooked
broader measures of economic development, such as productivity growth, technological
innovation, and improvements in living standards. By equating wealth with metal
reserves, mercantilism risked neglecting the long-term drivers of sustainable prosperity.
To stimulate wealth, mercantilist states implemented a range of policies that favored
domestic industries and colonial exploitation. Colonies were seen as both exclusive
providers of raw materials and captive markets for finished goods, ensuring a steady
inflow of bullion into the homeland. Governments enacted tariffs, subsidies, and strict
navigation laws to restrict foreign competition and expand domestic employment. State-
Assessment 1
Semester 2 2025
Due September 2025
, ECS3705
Assessment 1
Semester 2 2025
Due 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.
Mercantilists conceptualized wealth creation as the accumulation of precious metals,
especially gold and silver, which they considered the ultimate measure of a nation’s
prosperity. They viewed wealth as finite, embracing a zero-sum logic whereby one
nation’s gain inevitably came at another’s expense. To expand national wealth,
mercantilists emphasized achieving a trade surplus, exporting more than importing, and
thereby drawing bullion from foreign economies into the domestic treasury. This
emphasis on bullionism tied national strength to the amassing of reserves, with
manufactured exports prioritized over raw material imports. Colonies were exploited to
provide cheap resources, while individual enrichment was subordinated to the collective
wealth of the state. However, critics argue that this narrow fixation on bullion overlooked
broader measures of economic development, such as productivity growth, technological
innovation, and improvements in living standards. By equating wealth with metal
reserves, mercantilism risked neglecting the long-term drivers of sustainable prosperity.
To stimulate wealth, mercantilist states implemented a range of policies that favored
domestic industries and colonial exploitation. Colonies were seen as both exclusive
providers of raw materials and captive markets for finished goods, ensuring a steady
inflow of bullion into the homeland. Governments enacted tariffs, subsidies, and strict
navigation laws to restrict foreign competition and expand domestic employment. State-
