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Mercantilism

For Western European demographics the dividing line marking the change from a demo­graphic regime of a mainly stationary population to a progressively growing one occurs in the second half of the 1600s.

Then from the second half of the 1700s there was an unprecedented explosion in population growth, explained in terms of a gradual decline in the death rate, combined with a high birth rate, although the effect of these phenom­ena on each other is still not entirely clear.

Writers on this issue, starting from the seventeenth century, found themselves analys­ing a situation of considerable change, and this is probably partly why they expressed such a wide range of positions on the question of population. The basic position however remains that of general approval towards population growth and therefore towards policies that favoured it, through measures designed to encourage marriage and larger families, improve public health and limit emigration associated to incentives for the immigrant workforce, above all for qualified workers.

For the mercantilists, population growth essentially involved economic and politi­cal advantages. From the state’s point of view, population growth meant not only an important element in the country’s power policy but also, and above all, greater income and well-being for its citizens. The reason for this was that the population increase meant an increase in the labour force and, if the latter was employed in manufacturing, there would be a growth in productive capacity, exports and well-being. The emphasis on the nation’s well-being did not make the slightest reference to the idea of per capita income or wealth. It was understood implicitly that the greater wealth produced would generate benefits for the whole population, but these were still analysed at an aggregate level.

These authors believed the increase in the state’s wealth came about through a growth in production. To achieve this it was essential for the population to increase constantly so that the working population would also increase. The following passage from Daniel Defoe encapsulates this approach very well:

Trade encourages manufacture, prompts invention, employs people, increases labour, and pays wages: as the people are employed, they are paid, and by that pay are fed, clothed, kept in heart, and kept together; that is, kept at home, kept from wandering into foreign countries to seek business, for where the employment is, the people will be. This keeping the people together is indeed the sum of the whole matter, for as they are kept together, they multiply together; and the numbers the wealth and strength of the nation, increase. (Defoe 1728 [1973]: 51)

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Source: Faccarello G., Kurz H.-D.. Handbook on the history of economic analysis. Volume III, Developments in major fields of economics. Edward Elgar,2016. — 659 p. 2016

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