Overview What is mercantilism?

9/23/2016
(46) The Navigation Acts | The American Revolution | The road to revolution (1754-1800) | US history | Khan Academy
The Navigation Acts
British law stipulated that the American colonies could only trade with the mother country. Share
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Overview
The Navigation Acts were a series of laws passed by the British
Parliament that imposed restrictions on colonial trade.
British economic policy was based on mercantilism, which aimed to use
the American colonies to bolster British state power and finances.
The Navigation Acts inflamed the hostilities of American colonists and
proved a significant contributing event leading up to the revolution.
What is mercantilism?
Mercantilism was an economic theory that encouraged government
regulation of the economy for the purpose of enhancing state power. The
primary goal was to run trade surpluses and thereby fill the state’s coffers
with silver and gold. The predominant school of economic thought from the
15th through the 18th centuries, mercantilism rejected free trade and fueled
European imperialism.
Mercantilism led to wars between European powers for control of maritime
trade routes—such as the Anglo-Dutch Wars of the 17th and 18th centuries.
It also created thetriangular trade in the North Atlantic, which involved the
export of raw materials from the colonies to Britain and the subsequent
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importation of manufactured goods from Britain to the colonies.
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9/23/2016
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British economic policy was mercantilist in nature. The British Parliament
enacted such mechanisms as protectionist trade barriers, governmental
regulations, and subsidies to domestic industries for the purpose of
augmenting British finances at the expense of colonial territories and other
European imperial powers. England also sought to prevent its colonies in
North America from trading with other European countries and from
developing a robust manufacturing industry. To this end, beginning in 1651,
the British Parliament adopted a series of legislation known as
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the Navigation Acts.
The Navigation Acts prevented British colonies from trading with
nations other than Britain. Image credit: Wikimedia Commons
The Navigation Acts and the American
Revolution
With the outbreak of the English Civil War in 1642, the North American
colonies’ supply lines to metropolitan Britain were been disrupted. This led
the colonies to establish trade relations with the Dutch and the French in
order to encourage the flow of manufactured goods into North America. As
the English Civil War drew to a close, the British sought to reimpose control
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over colonial trade relations.
In 1651, the British Parliament, in the first of what became known as the
Navigation Acts, declared that only English ships would be allowed to bring
goods into England, and that the North American colonies could only export
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9/23/2016
(46) The Navigation Acts | The American Revolution | The road to revolution (1754-1800) | US history | Khan Academy
its commodities, such as tobacco and sugar, to England. This effectively
prevented the colonies from trading with other European countries. The act
was followed by several others that imposed additional limitations on colonial
trade and increased customs duties.
Although their overall economic impact was minimal, the Navigation Acts
imposed burdens on those segments of American colonial society best
positioned to foment a rebellion. The groups most negatively affected by the
Navigation Acts—colonial manufacturers and merchants; tobacco, rice, and
sugar planters; and artisans and mechanics—were all central actors in
prerevolutionary anti-British agitation. Merchants were especially active in
colonial politics, and they responded to the acts with hostility. The passage of
the Navigation Acts thus contributed to rising anti-British sentiment and the
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eventual outbreak of the American Revolution.
What do you think?
Describe mercantilism in your own words. Was it a just economic policy?
Were the foundations of mercantilist theory sound?
Can you imagine a policy the British could have adopted that would have
bolstered British finances without incurring the wrath of the colonists?
How important do you think the Navigation Acts were in solidifying anti-British
sentiment in the North American colonies?
[Notes and attributions]
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