The Stationary State In Classical Political Economy

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Explain the concept of the ‘stationary state’ in classical political economy. How did John Stuart Mill’s ideas on the stationary state differ from his predecessors?
Answer: According to Classical economist, there are two states of the process of growth:
I. Progressive State: Capital accumulation is proceeding, either smoothly or erratically in this system. It is a condition of positive economic growth, usually associated with high and rising profits and wages.
II. Stationary State: A stationary state is one in which growth is neither positive nor negative. Generally unwelcomed in classical political economy.

Until J.S. Mill Stationary state was considered undesirable economic state, popularly it was believed that growth benefits all three …show more content…

Despite these policies and the wars with which they were associated, the mercantilist period was one of generally rapid growth, particularly in England. It was based on the premise that national wealth and power were best served by increasing exports and collecting precious metals in return. According to this view the benefits to one nation were matched by costs to the other nations that exported gold and silver, and there were no net gains from trade(Zero Sum Game). The period 1500 - 1800 was one of religious and commercial wars, and large revenues were needed to maintain armies and pay the growing costs of civil government. Mercantilist nations were impressed by the fact that the precious metals, especially gold, were in universal demand. Foreign trade was favored above domestic trade, and manufacturing or processing, which provided the goods for foreign trade, was favored at the expense of the extractive industries (e.g., …show more content…

The doctrine of the Physiocrats was based on the axiom that agriculture alone was productive. Any scientific doctrine of economics, if formulated in France at this time, would almost certainly have been based on the primacy of agriculture. France was primary agricultural and French agriculture was a major problem. Just as agriculture was primary, another condition of their doctrine was not to disrupt the laws of nature. This concept led P.S. Dupont de Nemours to coin the word “Physiocrats,”from the Greek, meaning rule of Nature.
Nature was the only resource capable of being productive. This resource produce not only the raw materials and provisions necessary for the industry and commerce and survival of man (food); but was also capable of yielding in addition to the subsistence of laborers and remuneration to its proprietors, a surplus profit for the owners of the resources; the "produit

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