Absolutism Vs Mercantalism

Throughout history there have been many approaches to the economic portions of a government. However the main goal has always been to improve the wealth of a country. Two key economic thinkers are Jean Baptiste Colbert and Adam Smith. Colbert was a Frenchman who believed in mercantalism, While Smith was English, wantng a capitalist country. Though both had their benefits, capitalism and mercantalism were very different and capitalism prevailed in the loong run.

Mercantalism was a key part of the French Empire under the leadership of Louis XIV. His economic commander was Colbert who believed that mercantalism was the perfect way to improve the countries wealth and supply money for Louis' wars. Mercantalism was focused on colonies and a favorable balance of trade. The country wanted to import little and export a lot to drive up profit. High tarrifs were placed on imported goods to prevent people from buying and therefor force the country to sustain itself. Also, natural goods needed for prodction would be brought in by the countries colonies in the mercantalist system. The Idea was to drive up the wealth and gold reserves of the state, thus providing money for war and expansion.
Smith believed in Laissez Faire economics or the idea that the goverment should be removed from economics and regulation. He beleeived in no goverment restriction and free trade. Many argued that this would lead to poor products and high prices. Smith countered that the aeffect of supply and demand would act like an invisible hand, guiding production. You were forced to make a good product because no one would buy it if it was garbage or overpriced. Capitalism forced competion which increased the quality of goods and drove the price down. This not only helped the average person but the state as well because the country was producing higher quality