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In order to achieved trade surplus, their governments monopolized trade activities, provided subsidies and other incentives for export, and restricted imports. Since most European countries were colonial powers, they imported low cost raw material from their colonies and exported high cost manufactured goods to the colonies. They also prevented colonies from producing manufacturing. All this was done in order to generate export augmentation and import restriction lay at the root of the mercantilist theory of international trade. However, the later versions of the mercantilist doctrine explained that trade surplus was not an overlasting phenomenon...
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