Essay about Adam Smith and the Principle of the Mercantile System
Adam Smith wrote that commerce in Europe, but more specifically Great Britain, went from a system where the producers changed to adapt to what the consumers needed, to a system where the producers would try their hardest to corner the market, and in that, would leave the consumers with a mediocre product. In response to tightened importation laws, he wrote that a strong foreign trade system would be the only way to provide good products to the English public. Adam Smith was accurately seeing the future of the world’s commerce. He saw that as producers tried to make more and more money, they were forced to cut corners. This resulted in products that were worse than they could …show more content…
Smith, Adam; The Wealth of Nations 1776
In this paragraph, it is the Mercantile System, a system recommended by Smith to fix the problems in British commerce. In the Mercantile system, foreign trade is highly encouraged because it helps benefit the consumers, and helps lower cost for the consumer. It is a very consumer based system. It limits the exportation of goods, for the benefit of the local workmen , and welcomes the importation of foreign goods, to benefit of local consumers. This is unfortunately not how the Mercantile System actually worked. Smith believed that commerce had been warped in the minds of greedy consumers. Unfortunately, with prohibitions on import in Great Britain, the Mercantile System could only work half way. The key aspect to the Mercantile System is that it allows goods from other countries to be imported. When importation is blocked, the Mercantile System can no longer be effective, and it leads commerce in a new direction.
Consumption is the sole end and purpose of all production; and the interest of the producer ought to