Discussing the Mercantilist and the Physiocratic systems, Adam Smith is inclined to focus more on the advantages of the Physiocratic system as opposite to the Mercantilist one because Mercantilism is based on the support of the strongly regulated commerce which cannot contribute significantly to Great Britain’s increase in the production of goods.
Smith states that the British authorities are traditionally focused on developing the industry and market while prohibiting the imports and providing trade regulations in order to contribute to the monopoly of the home market and industry.
From this point, the authorities support the spirit of monopoly in relation to merchants and traders. However, according to Smith, such an approach is not as effective as the focus on the annual produce of the industry and land typical for the Physiocratic system.
As a result, Smith chooses to support the Physiocratic tradition of the economic thought according to which the focus should be shifted from supporting the commerce to supporting the farmers and their agricultural activities.
Thus, the support of the domestic industry is possible with the focus on encouraging the farmers and other representatives of the British society to produce more in the situation when imports can be limited because the encouragement of farmers leads to the growth in production.
If the Mercantilist system depends on the idea of the effective trade to support and create the economic advantage, the Physiocratic tradition is based on supporting the domestic industry and market where farmers can operate effectively while improving the production of goods and contributing to the growth of the state’s wealth.
Thus, every British family can add to the increase of the country’s wealth and economic development.