U.S. history concepts · AP U.S. History
Mercantilism
Mercantilism: An economic theory that a nation's power depends on accumulating wealth through a favorable balance of trade, with colonies supplying raw materials and buying finished goods.
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What it means
Under mercantilism, European powers saw colonies as sources of raw materials and markets for manufactured goods, with trade controlled to benefit the home country. Britain's Navigation Acts, which required certain colonial goods to be shipped through England on English ships, reflected these ideas.
Mercantilist policies shaped colonial economies and later fed colonial resentment when Britain began enforcing trade laws more strictly after 1763.
Example
The Navigation Acts required tobacco from Virginia to be shipped to England before it could be sold elsewhere, giving English merchants and the crown a share of the profits.
On the exam
Mercantilism appears in Period 2 questions about colonial economies and in Period 3 questions about the causes of the Revolution.