Question

what are some similarities between mercantalism and capitalism ?

Answer 1

Mercantilism refers to an economic system based on international trade. Merchants use export and import of goods in hope of making a some profit. Because many of businesses in a modern capitalist economy do the similar thing, so that mercantilism can be interpreted as an 1st or you can say early form of capitalism.

Smilarities

1. Profit Motive

the main similarities between to is making profit through export and import.

2. international Diplomacy

in mercantile system, it was used as a tool for opening markets to trade. Governments of that time imposed high tariffs on imports of goods.

For instance , American merchants hoping to trade with South Arabia in the 1600s had to pay tariffs as high as 50 - 60%. Diplomats sought to find some ways around these type of trade barriers. Where as Modern capitalism also depends on this diplomacy. For Example, the American Free Trade Agreement of 1994 eliminated trade barriers between the USA,amico & Canada.

3. Exchange Value

Capitalist Economy, people produce goods for their exchange value like A carpanter exchange their chair for a bag of floor.

Where as in Mercantilist sells goods in exchange of good and silver.