Why does globalization give countries an incentive to reduce wages for their
2 answers:
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Answer:
Explanation:
Mercantilism is an economic policy that thrived beginning in the 1500s. It was one of the driving forces behind colonization and imperialism.
- A country wanted to gain as much wealth as possible. One way to accomplish this goal was to implant a<u> </u><u><em>favorable balance of trade</em></u>. This meant the country exported more goods (sold) than it imported (bought). Essentially, the wealth flowing into the nation was greater than the money leaving.
- The countries needed a way to create this balance. So, they began to colonize. <u><em>Colonie</em></u><em>s </em>were incredibly valuable because they had natural resources. The mother country extracted the resources from the colony, produced goods in the country, and then sold them back to the colony. This practice maximized their wealth, gold, silver, and power.
The best answer choice must be D. Build the nation's gold and silver reserves by exporting more goods than it imported.