Neo-mercantilism

1. Neo mercantilism Towards the end of 18th century and the beginning of 20th century

2. Definition of neo-mercantilism: A revived theory of mercantilism emphasizing trade restrictions and commercial policies as means of increasing domestic income and employment. In other words the new policy of state encouragement and assistance to industry is known as Neo mercantilism .

3. Some fundamental differences between mercantilism and neo-mercantilism 1.Mercantalism emphasized on the development of trade under state control While neo mercantilism policy envisaged a state activity of another kind assistance support defenses rather then regulation and control . 2.Mercantalisim is based on the “Policy of plenty” and the neo mercantilism is based on “Policy of power” . 3.The main concept of Mercantilism Lassies-Faire principle with the emphasis on individualism unfettered competition and free trade .Neo Mercantilism concept based on that government must assist and encourage industry and commerce .

4. Meaning of Mercantilism for underdeveloped country Mercantilism have dealt with many factor of economic growth such as consumption investment the role of government money and capital The difference between economic and social condition of mercantilism flourished and present day under developed countries : 1.Well equipped resource per head and greater man land ratio . 2.International transfer relation 3. Develop by means of activities of millions of private entrepreneur's under the policy of non intervention

5. 4.Mercantalisim consider the non agriculture sector foreign trade manufacturing sector as strategies in the economic growth of nation . 5.Most important rule to increasing money.

6. Relevant Mercantilism policy with present day underdeveloped countries policy : 1.Policy of maximizing export and minimizing import for balance foreign exchange . 2.Government provide financial and non financial assistance to the export sector and import of non essential commodities should be restricted