“Every man lives by exchanging.” Unit 1 Day 7 Mercantilism Quote: “Every man lives by exchanging.” Adam Smith Objective: Students will understand the role Mercantilism played in the Colonies by summarizing the effects that it caused Strand 1 Concept 4 PO 1

Beginning around 1650, the British government pursued a policy of mercantilism in international trade. Mercantilism stipulates that in order to build economic strength, a nation must export more than it imports.

Mercantilism is all about trade and how trade is conducted Mercantilism is all about trade and how trade is conducted. It is a system of government controlled trade. It is not a system of free trade.

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The English passed regulatory laws exclusively benefiting the British economy. These laws created a trade system whereby Americans provided raw goods to Britain, and Britain used the raw goods to produce manufactured goods that were sold in European markets and back to the colonies.

The English Parliament would pay “bounties” to Americans who produced certain raw goods, while raising protectionist tariffs on the same goods produced in other nations.

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