Contextualization

Mercantilism, an economic theory that dominated European economic policies from the 16th to the 18th century, is a fascinating subject in the history of economics. It was a system that aimed to enrich the mother country by the accumulation of gold and silver. During this period, colonies played a crucial role in the economic strategy of the European powers, serving as sources of raw materials and markets for finished goods.

The theory of mercantilism rested on four key pillars: the idea of the balance of trade, the accumulation of precious metals, the promotion of domestic industries, and the establishment of colonies. It advocated for a positive balance of trade, meaning exports should exceed imports, to ensure inflow of gold and silver. This was believed to increase a nation's wealth.

The idea of mercantilism was a driving force behind European colonial expansion. European nations established colonies to secure sources of raw materials, which they would then use to manufacture goods. These finished goods would then be sold to the colonies, creating a cycle of economic dependence. This system led to the rise of global trade and significantly impacted the economic and social landscape of the world.

Importance and Real-World Application

Although mercantilism has been largely replaced by other economic theories, its effects can still be seen in the global economy today. The concept of a positive balance of trade is still regarded as an important indicator of a nation's economic health. Countries still seek to secure sources of raw materials to fuel their industries, and the establishment of economic dependencies is not uncommon.

Understanding the principles of mercantilism is key to comprehending the origins of modern economic systems, the dynamics of global trade, and the causes and consequences of colonialism. It provides a historical context for many contemporary economic and political issues. For instance, debates on protectionism and free trade, resource exploitation, and economic disparities between nations often draw on concepts rooted in mercantilism.

Resources

To delve deeper into the topic of mercantilism, you can refer to the following resources:

1. Mercantilism: The Concise Encyclopedia of Economics
2. Mercantilism: Khan Academy
3. The Wealth of Nations by Adam Smith - This book provides a critique of mercantilism and proposes an alternative economic theory.
4. Global Economic History: A Very Short Introduction by Robert C. Allen- This book gives a broader understanding of the global economic system, including the role of mercantilism.
5. Crash Course World History: Mercantilism - This video provides an engaging overview of mercantilism.

Remember, understanding the past helps us make sense of the present and prepare for the future. So, let's delve into the intriguing world of mercantilism!

Practical Activity

Activity Title: The Mercantilism Game

Objective of the Project:

The objective of this project is to facilitate a deeper understanding of the key concepts of mercantilism through an engaging and interactive game format. Students will role-play as different nations during the mercantilist era and make economic decisions based on the principles of mercantilism. The game will simulate trading, colonial expansion, and the accumulation of wealth to demonstrate the economic dynamics of the period.

Detailed Description and Step-by-Step for Carrying Out the Activity:

Materials Needed:

• Large world map
• Miniature flags representing different nations (England, Spain, Portugal, France, and Netherlands)
• Tokens representing gold and silver
• Tokens representing raw materials (cotton, sugar, tobacco, etc.)
• Tokens representing finished goods (clothes, tools, etc.)
• Notebooks and pens for each group

Steps:

1. Formation of Groups and Assignment of Roles: Divide the class into five groups, each representing one of the major European powers during the mercantilist era (England, Spain, Portugal, France, and Netherlands). Each group should consist of 3-5 students.
2. Understanding the Role: Each group should spend some time researching their assigned nation during the mercantilist era. They should focus on understanding their nation's economic policies, trading partners, colonial holdings, and major industries.
3. Designing the Game: Each group will design part of the game based on their research. This should include the rules for trading, colonial expansion, and the accumulation of wealth. They should also decide on the initial resources each nation has and the potential outcomes of their economic decisions.
4. Playing the Game: Each group will take turns playing the game. The teacher will facilitate and ensure that the game is played according to the designed rules. The game should cover at least 50 years of simulated time.
5. Recording Observations: Each group should record their observations and the outcomes of their decisions during the game. They should reflect on how their decisions were influenced by the principles of mercantilism and how these decisions affected their nation's wealth and power.
6. Debriefing and Discussion: After the game, there will be a class-wide discussion where each group can share their observations and the outcomes of their decisions. The teacher will provide additional context and insights into the period.
7. Report Writing: Each group will then write a report detailing their understanding of the principles of mercantilism, their experiences during the game, and the outcomes of their decisions.

Project Deliverables and Detailed Description:

The written report should be divided into four main sections: Introduction, Development, Conclusions, and Used Bibliography.

Introduction: This section should provide a brief overview of mercantilism, its relevance, and real-world application, as well as the objective of the game and the role assigned to the group.

Development: In this section, students should detail the theory and history of mercantilism based on their research. They should describe the design of the game, the rules they created, and their initial strategy. They should then recount their experiences during the game, detailing the decisions they made and the outcomes of those decisions. They should also include any unexpected events or challenges they encountered during the game and how they responded to them.

Conclusion: This section should reflect on their experiences during the game and what they learned about the principles of mercantilism. They should discuss how their understanding of mercantilism changed as a result of the game and what they would have done differently if they had the chance to replay the game. They should also discuss the broader implications of mercantilism and its relevance to modern economic and political issues.

Used Bibliography: This section should list all the resources they used to research mercantilism and their assigned nation. They should follow the appropriate citation format for their discipline.

The report should be a collaborative effort, with each member of the group contributing to the different sections. It should be well-structured, clearly written, and properly referenced. It should not only demonstrate their understanding of mercantilism but also their ability to work as a team, to think critically, and to communicate effectively.