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This reasoning is effectively what was behind mercantilism. It's why empires didn't extensively trade with one another. Interesting to note that even back then
by Aerroon 5y ago
This reasoning is effectively what was behind mercantilism. It's why empires didn't extensively trade with one another. Interesting to note that even back then it was an important matter.
- dragonelite 5y agoWe are still the same peoples creating the same kind of problems and think of the same kind of solutions. It just that technology has decreased the size of the world and has increased the speed at which those problems happen.
- Aerroon 5y agoIt's not quite the same since Adam Smith though. Lifting trade restrictions has correlated with the greatest prosperity known to mankind. It turns out that if your trade balance makes your currency very cheap then investing in your country also becomes cheap. This increases your (cheaper) production and then increases your exports making your currency more expensive. Ie trade balance tends to balance itself out.