Federal Capital (Paco Urondo Agency, Buenos Aires Economico published 17/09/2010)
mercantilist school had its boom period in Europe between the fifteenth and eighteenth centuries, expanding foreign trade and traders. The central idea of \u200b\u200bthe mercantilist era that wealth consisted of precious metals (gold, silver and bronze) and, therefore, the goal of every country was to accumulate as much precious metal as possible.
In this sense, the best way to increase the stock of precious metals (to be universally accepted currency at that moment in history) was a foreign trade through export from Most goods and import as little as possible. Indeed, export of precious metals involved input and output was imported gold, silver and bronze.
Therefore, for this school was the central concept of the trade balance (exports minus imports). The trade balance may have two results: a) that exports are greater than imports, namely, trade surplus, b) that exports are less than imports, ie, the trade deficit.
The trade balance surplus is then translated into accumulation of precious metals and national enrichment. In contrast, the trade deficit would Sunrise and destocking of precious metals and the consequent impoverishment of the country. Thus, according to the mercantilist countries-in an effort to increase national wealth, should aim to achieve a trade surplus that would allow increasing the amount of gold, silver and bronze.
To this end the state's role was crucial. Indeed, state intervention in the economy was essential to the mercantilist to achieve a positive trade balance and allow this way, the entry of precious metals. In the mercantilist conception, the stronger the state was the nation's richest.
However, the only objective was to have government intervention to this school of economics was the steady rise in exports and the steady reduction of imports, for which recommended a set of economic policies that had to carry out the nation state.
For example, for the mercantilist protectionism was essential to avoid growth of imports and thereby reduce the output of precious metals and the impoverishment of the country. Therefore, the establishment of import tariffs by the national state was a central policy for this school.
On the other hand, it also recommended a series of policies to increase as possible foreign sales. The creation of commercial monopolies (one company for each region to which it is traded) to avoid internal competition and thereby set the highest possible price for the highest entry of precious metals.
economic
This school was opposed to competition between commercial enterprises of the country due to that generated the lower prices only country benefiting buyers could purchase goods at a reduced price, but by ruining the country because that meant seller at the entrance of a smaller amount of precious metals.
Therefore, to avoid it mercantilists consolidation recommended by the national state trading monopolies can set prices as high as possible. While hurting the purchasing country, having to pay a higher price for the products, benefiting the country ended merchant receive, due to rising commodity prices, a greater quantity of gold, silver and bronze and this is the largest accumulation of wealth.
But while thus eliminated the domestic competition, it could happen to compete with other business enterprise in another country. Again, this would create competition that would result in lower prices. In this situation the mercantilist advocated by what is known as dumping, ie reducing prices below costs. Put another way, according to this school of economics, foreign competition to commercial monopolies should operate at a loss to destroy the other business and return to become the only company to sell to that market.
Before the dumping, the State should be in charge of financing business enterprises generated to cover the loss. Even if the other company was dumping trade also win that he had behind him the strongest and most powerful state to allow him to fund it for a while longer. This demonstrates the focus of state intervention in the economy to the mercantilist: win as many potential foreign markets.
also recommended the increase of re-exports, ie buy a product cheaper in a country and then sell more expensive in another. In this regard, while re-exports resulted in an outflow of precious metals to purchase products in another country, at the end of the commercial distribution of precious metals ended up getting most of those who left. Therefore, re-exports also implied an increase in wealth accumulation. Again, to carry out this policy was central to the state's role in building de la flota naval necesaria para la reexportación.
Por último, otra de las políticas recomendadas por los mercantilistas era el aumento constante del saldo exportable, es decir, de las mercancías disponibles para las exportaciones. El saldo exportable es la diferencia entre la producción y el consumo interno. Por lo tanto, existen dos formas para incrementarlo: aumentando la producción y reduciendo el consumo interno.
En el corto plazo, donde es difícil conseguir un crecimiento de la producción, el aumento del saldo exportable se debe fundamentalmente a la reducción del consumo interno.
De esta manera, el aumento del mercado interno es contraproducente según los mercantilistas because it decreases the amount of goods available for export. Even recommended the reduction of domestic consumption that would increase the availability of products intended for foreign sales and thus gain entry to the largest possible amount of precious metals.
In short, logic design and mercantilist economies should be structured around the outside market, with the growth of domestic consumption and counterproductive to increase national wealth. It is true that there are some tenets of mercantilism were advanced even for today. For example, for this economic school only had to import raw materials that were manufactured in-house and then they are exported but with a higher added value, which would imply a greater influx of precious metals that came with the importation of inputs.
in Argentina was consolidated throughout history, a myopic mercantilism rescues only the worst part of his theory. In fact, the owners of land and food producers in Argentina rescue only the idea of \u200b\u200bthe national economy structure around the outside market, but also advocate the export of as many possible non-value added goods.
Currently, agricultural institutions claim that Argentina's economy to focus its economic growth based on exports of primary products, mainly soy. For this industry, take advantage of the international context of higher food prices means permanently increasing the exportable surplus as intended by the mercantilist. In this sense, agricultural employers for the growth of consumption of Argentine food is not functional to their economic logic of non-value added export products.
is why we are strongly opposed to new development model introduced in 2003, which involved a significant increase in domestic consumption from the reduction of unemployment as a result the process of re-industrialization of Argentina's economy, the steady increase of pensions, increasing the salaries of workers as a result of the return of collective bargaining agreements, the rise in public investment, social plans such as worker cooperatives and the family allowance per child, among other measures. This growth of the domestic market resulting in the need for food producers must devote much of their production to the domestic market and thereby reduce their exportable surplus and extraordinary profitability.
Then, as agricultural institutions, to exploit the international context is "selling to the world what the world needs: food "which means increasing the exportable surplus of food consumption at the expense of the Argentines. This is shortsighted national mercantilism: Argentina's economy structure based on the external market, but also unlike the mercantilist, without any added value.
the other hand, the current economic model advocated by the continuous rise of the domestic market as an engine of growth and increased exports of manufactured goods with a strong national labor and technological development. Why take the international context is not selling what the developed countries consume, but rather to produce and countries export what they produce and export power.
The author is an economist of the Study Group of National Economy and Popular (GEENaP). www.geenap.com.ar
Agency (Paco Urondo)
mercantilist school had its boom period in Europe between the fifteenth and eighteenth centuries, expanding foreign trade and traders. The central idea of \u200b\u200bthe mercantilist era that wealth consisted of precious metals (gold, silver and bronze) and, therefore, the goal of every country was to accumulate as much precious metal as possible.
In this sense, the best way to increase the stock of precious metals (to be universally accepted currency at that moment in history) was a foreign trade through export from Most goods and import as little as possible. Indeed, export of precious metals involved input and output was imported gold, silver and bronze.
Therefore, for this school was the central concept of the trade balance (exports minus imports). The trade balance may have two results: a) that exports are greater than imports, namely, trade surplus, b) that exports are less than imports, ie, the trade deficit.
The trade balance surplus is then translated into accumulation of precious metals and national enrichment. In contrast, the trade deficit would Sunrise and destocking of precious metals and the consequent impoverishment of the country. Thus, according to the mercantilist countries-in an effort to increase national wealth, should aim to achieve a trade surplus that would allow increasing the amount of gold, silver and bronze.
To this end the state's role was crucial. Indeed, state intervention in the economy was essential to the mercantilist to achieve a positive trade balance and allow this way, the entry of precious metals. In the mercantilist conception, the stronger the state was the nation's richest.
However, the only objective was to have government intervention to this school of economics was the steady rise in exports and the steady reduction of imports, for which recommended a set of economic policies that had to carry out the nation state.
For example, for the mercantilist protectionism was essential to avoid growth of imports and thereby reduce the output of precious metals and the impoverishment of the country. Therefore, the establishment of import tariffs by the national state was a central policy for this school.
On the other hand, it also recommended a series of policies to increase as possible foreign sales. The creation of commercial monopolies (one company for each region to which it is traded) to avoid internal competition and thereby set the highest possible price for the highest entry of precious metals.
economic
This school was opposed to competition between commercial enterprises of the country due to that generated the lower prices only country benefiting buyers could purchase goods at a reduced price, but by ruining the country because that meant seller at the entrance of a smaller amount of precious metals.
Therefore, to avoid it mercantilists consolidation recommended by the national state trading monopolies can set prices as high as possible. While hurting the purchasing country, having to pay a higher price for the products, benefiting the country ended merchant receive, due to rising commodity prices, a greater quantity of gold, silver and bronze and this is the largest accumulation of wealth.
But while thus eliminated the domestic competition, it could happen to compete with other business enterprise in another country. Again, this would create competition that would result in lower prices. In this situation the mercantilist advocated by what is known as dumping, ie reducing prices below costs. Put another way, according to this school of economics, foreign competition to commercial monopolies should operate at a loss to destroy the other business and return to become the only company to sell to that market.
Before the dumping, the State should be in charge of financing business enterprises generated to cover the loss. Even if the other company was dumping trade also win that he had behind him the strongest and most powerful state to allow him to fund it for a while longer. This demonstrates the focus of state intervention in the economy to the mercantilist: win as many potential foreign markets.
also recommended the increase of re-exports, ie buy a product cheaper in a country and then sell more expensive in another. In this regard, while re-exports resulted in an outflow of precious metals to purchase products in another country, at the end of the commercial distribution of precious metals ended up getting most of those who left. Therefore, re-exports also implied an increase in wealth accumulation. Again, to carry out this policy was central to the state's role in building de la flota naval necesaria para la reexportación.
Por último, otra de las políticas recomendadas por los mercantilistas era el aumento constante del saldo exportable, es decir, de las mercancías disponibles para las exportaciones. El saldo exportable es la diferencia entre la producción y el consumo interno. Por lo tanto, existen dos formas para incrementarlo: aumentando la producción y reduciendo el consumo interno.
En el corto plazo, donde es difícil conseguir un crecimiento de la producción, el aumento del saldo exportable se debe fundamentalmente a la reducción del consumo interno.
De esta manera, el aumento del mercado interno es contraproducente según los mercantilistas because it decreases the amount of goods available for export. Even recommended the reduction of domestic consumption that would increase the availability of products intended for foreign sales and thus gain entry to the largest possible amount of precious metals.
In short, logic design and mercantilist economies should be structured around the outside market, with the growth of domestic consumption and counterproductive to increase national wealth. It is true that there are some tenets of mercantilism were advanced even for today. For example, for this economic school only had to import raw materials that were manufactured in-house and then they are exported but with a higher added value, which would imply a greater influx of precious metals that came with the importation of inputs.
in Argentina was consolidated throughout history, a myopic mercantilism rescues only the worst part of his theory. In fact, the owners of land and food producers in Argentina rescue only the idea of \u200b\u200bthe national economy structure around the outside market, but also advocate the export of as many possible non-value added goods.
Currently, agricultural institutions claim that Argentina's economy to focus its economic growth based on exports of primary products, mainly soy. For this industry, take advantage of the international context of higher food prices means permanently increasing the exportable surplus as intended by the mercantilist. In this sense, agricultural employers for the growth of consumption of Argentine food is not functional to their economic logic of non-value added export products.
is why we are strongly opposed to new development model introduced in 2003, which involved a significant increase in domestic consumption from the reduction of unemployment as a result the process of re-industrialization of Argentina's economy, the steady increase of pensions, increasing the salaries of workers as a result of the return of collective bargaining agreements, the rise in public investment, social plans such as worker cooperatives and the family allowance per child, among other measures. This growth of the domestic market resulting in the need for food producers must devote much of their production to the domestic market and thereby reduce their exportable surplus and extraordinary profitability.
Then, as agricultural institutions, to exploit the international context is "selling to the world what the world needs: food "which means increasing the exportable surplus of food consumption at the expense of the Argentines. This is shortsighted national mercantilism: Argentina's economy structure based on the external market, but also unlike the mercantilist, without any added value.
the other hand, the current economic model advocated by the continuous rise of the domestic market as an engine of growth and increased exports of manufactured goods with a strong national labor and technological development. Why take the international context is not selling what the developed countries consume, but rather to produce and countries export what they produce and export power.
The author is an economist of the Study Group of National Economy and Popular (GEENaP). www.geenap.com.ar
Agency (Paco Urondo)
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