In mercantilism the individual was unconditionally subordinated to the state. He was not regarded as an end in himself, but as a tool for implementing state aims. This was as true of the businessman as anyone else.

He was expected to work toward the welfare of the nation. Collective economic goals took precedence over individual ones. This was rationalized on the ground that the welfare of the individual depends upon the security he is provided by the state. Thus social order was viewed as the cause of individual freedom.

In England there was a general belief among the merchants that they were sacrificed to state interests. The underlying idea, according to Eli Heckscher, the leading historian of mercantilism, was that "the profit of the merchant in itself was no criterion of the profit of the country, but on the contrary, the profit of the individual could be the country's loss and vice versa.

Thomas Mun, a leading mercantilist writer, distinguished between the commercial gain of the country, the merchant, and the king, and pointed out the possibility that any one of the three could realize a profit while the other two suffered losses.7 Josiah Child, a con-temporary of Mun's, pictured the merchants as martyrs of society. He started with the premise that "all Trade will be less gainful to Individuals, though more profitable to the Public," and wondered, "whatever becomes of the poor merchants."8

Thus there was implicit in mercantilist thought a dichotomy between the welfare of the individual and the state. One did not necessarily lead to the other. Where there was a conflict between the two, the welfare of the state prevailed.

The stage was set for the decline of mercantilism by the Industrial Revolution in the late eighteenth and early nineteenth centuries. This revolution occurred in central london plumber three phases: (1) changes in manufacturing and transportation, made possible by the development of power-driven machinery; (2) the shift from small-scale production in the home to large-scale production in the factory; and (3) changes in social organization brought on by the new production techniques and the factory system.

The Industrial Revolution originated in Great Britain, leaped across the English Channel to France after the Napoleonic Wars, and was introduced later in Germany and the Scandinavian countries.

It was not by chance that this revolution commenced in England. The feudal system and the medieval preoccupation with the life hereafter declined more rapidly there than on the continent. An ideological system developed which was conducive to individual freedom and fairly rapid social and economic mobility. This was manifested in economic life by the early decline of serfdom and the guild system and the emergence of a manufacturing system based on handicrafts and petty capitalism.

The medieval customs barriers between towns and regions were abolished early, and the social climate was favourable for trade. Social and political conditions were propitious for the rise of a new business class. Thus long before the appearance of the technological innovations which gave the Industrial Revolution its initial impetus, ideological and organizational conditions were ripe for such a development.

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