What is mercantillsm?

Mercantilism is an economic theory and practice that dominated Europe from the 16th to the 18th century. It emphasizes the importance of wealth accumulation, particularly gold and silver, through a favorable balance of trade, where exports exceed imports. Governments played a crucial role by imposing regulations, tariffs, and monopolies to strengthen their economies and enhance national power. Mercantilism ultimately laid the groundwork for modern economic thought, though it was later challenged by free-market theories.