Mercantilism and the contested category of neomercantilism

Mercantilism is a retrospective label for diverse early-modern policies and arguments connecting trade, production, revenue, bullion, shipping and state power. Neomercantilism is a later and contested label applied to some efforts to build national productive capacity, manage dependence or use external economic relations for power. Neither term identifies a single timeless doctrine, founder or policy formula.

Historical practice and historiography

Early-modern governments used tariffs, navigation rules, chartered monopolies, colonial restrictions, export promotion, production support and controls on strategic goods. Their purposes varied by country, period and institution. Revenue, employment, shipping, fiscal capacity, military supply and relative power could matter alongside bullion or the trade balance. It is therefore inaccurate to say that one coherent school uniformly dominated Europe for three centuries or that all its adherents assumed a fixed quantity of world wealth.

The historiography shaped the category after the fact. Eli Heckscher offered a foundational synthesis of mercantilism and state-building. Jacob Viner showed variation in the relationship between power and plenty. Lars Magnusson examined mercantilism as an economic language rather than a mechanical checklist. Adam Smith's critique of the mercantile system was itself an intervention in the debate and cannot serve as a neutral inventory of every earlier writer.

Bullionism was one element in some settings, not a complete synonym. A defensible historical claim identifies the actor, text, institution, instrument and strategic setting rather than treating the later category as evidence.

Later national-development thought

Alexander Hamilton's 1791 Report on the Subject of Manufactures argued for manufacturing capability, independence and security in the early United States. Friedrich List's 1841 National System of Political Economy emphasised national productive powers and staged development. Both belong to the history of economic nationalism, but neither should be collapsed into a generic seventeenth-century bullionist doctrine.

Eric Helleiner's global history of neomercantilist thought also shows that national-development arguments emerged in varied settings and cannot be reduced to a single European lineage. Economic nationalism may prioritise national development without reproducing the institutions, colonial system or monetary assumptions of early-modern practice.

Statecraft classification and modern use

The category's state nexus and intent are contested. Specific tariffs, navigation laws, monopolies, subsidies, procurement rules and colonial measures had direct public authorities and identifiable objects. Chartered companies, merchants, banks, manufacturers and customs services often transmitted them. The analytical label itself, however, is supplied by an author or later scholar. It does not establish the intent or mechanism of any particular state action.

The same discipline applies to neomercantilism. A modern industrial policy can pursue prosperity, distribution, climate objectives, resilience or strategic advantage. Tariffs, subsidies or domestic-content rules do not make it neomercantilist by definition. The analyst must state the source's definition, identify the policy's external orientation and test alternative explanations.

Contemporary economic-security and fragmentation debates revive questions about productive capability, dependency and relative gains. They do not prove that all interventionist states have converged on one doctrine. Concrete instruments and cases belong in the main sequence; this page remains context because it explains an intellectual and historiographical tradition.

Power, prosperity and contestation

Mercantilist and liberal traditions both contain claims about prosperity, security and order. Liberal thought did not remove security from economic policy after 1945, just as power-oriented policy did not ignore welfare. Hirschman later analysed how trade structure can create dependence and political influence, while Baldwin distinguished economic means, policy objectives and success. These tools sharpen analysis without imposing a moral binary between power and plenty.

See also

Economic statecraft · Geo-economics (geoeconomic manoeuvre) · Economic security as national security · Made in China 2025 industrial policy (2015-2025) · CHIPS Act and the semiconductor subsidy race (2022-present) · Friend-shoring and de-risking · Autarky

Sources

1. Eli F. Heckscher, Mercantilism, translated by Mendel Shapiro, revised second edition, with an introduction by Lars Magnusson (Routledge, 1994; original Swedish edition 1931).
2. Jacob Viner, "Power versus Plenty as Objectives of Foreign Policy in the Seventeenth and Eighteenth Centuries", World Politics 1, no. 1 (1948): 1-29.
3. Lars Magnusson, Mercantilism: The Shaping of an Economic Language (Routledge, 1994).
4. Eric Helleiner, The Neomercantilists: A Global Intellectual History (Cornell University Press, 2021).
5. Eric Helleiner, "Economic Nationalism as a Challenge to Economic Liberalism? Lessons from the Nineteenth Century", International Studies Quarterly 46, no. 3 (2002): 307-329.
6. Alexander Hamilton, "Final Version of the Report on the Subject of Manufactures", 5 December 1791, Founders Online, National Archives.
7. Friedrich List, The National System of Political Economy, translated by Sampson S. Lloyd (Longmans, Green, 1909; first published in German 1841).
8. Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book IV (1776).
9. Albert O. Hirschman, National Power and the Structure of Foreign Trade (University of California Press, expanded edition, 1980; first published 1945).
10. David A. Baldwin, Economic Statecraft (Princeton University Press, 1985).
11. Douglas A. Irwin, Against the Tide: An Intellectual History of Free Trade (Princeton University Press, 1996).
12. International Monetary Fund, Geoeconomic Fragmentation and the Future of Multilateralism, Staff Discussion Note 2023/001 (2023).