By Dani Rodrik, Ford Foundation Professor of International Political Economy at Harvard University’s John F. Kennedy School of Government, former President of the International Economic Association, and Member of SAGE’s Academic Committee

  October 15, 2025 — National Bureau of Economic Research, NBER Working Paper Series, Paper No. 34353 (Working Paper)

ABSTRACT: Economics students today learn about mercantilism through Smith’s prism, as a series of logical and policy errors that Smith clarified and settled for good. But far from settled doctrine, mercantilism encapsulated a variety of pragmatic practices that survived Smith’s critique, often to good effect. It found echo in a continuous tradition of what later came to be called“developmentalism,” running from Alexander Hamilton and Friedrich List’s advocacy of trade protection to Hans Singer and Raul Prebisch’s ideas on import-substitution and, more recently, to East Asian models of export-oriented industrialization. Three of its core tenets hold continued appeal: the primacy of production and jobs (and of their composition) over consumption; preference for close, collaborative relationship between business and government over an arms’ length relationship; and the need for contextual, pragmatic, and often unorthodox policies over universal remedies and “best-practices.”

Read More: https://www.nber.org/papers/w34353