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Friedrich List: Excerpt from National System of Political Economy (1841)

In this excerpt from National System of Political Economy (1841), economist Friedrich List (1789-1846) elaborates on the stages of economic development, the distinction between cosmopolitan and nationalist views of economics, and the importance of protectionism. A critic of the free-market thinker Adam Smith and his followers, List argued that less developed economies like Germany's required protective tariffs on manufactured goods to allow their fledgling industries to grow. List's specifically national interpretation of economics called for restrictions on international trade but advocated free trade and occupational freedom in the German states.

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[ . . . ]

For greater clearness, we give here a cursory view of the principal results of his researches and meditations:

The association of individuals for the prosecution of a common end, is the most efficacious mode towards ensuring the happiness of individuals. Alone, and separated from his fellow-creatures, man is feeble and destitute. The greater the number of those who are united, the more perfect is the association, and the greater and the more perfect is the result, which is the moral and material welfare of individuals.

The highest association of individuals now realized, is that of the state, the nation; and the highest imaginable, is that of the whole human race. Just as the individual is happier in the bosom of the state than in solitude, all nations would be more prosperous if they were united together, by law, by perpetual peace, and by free interchange.

Nature leads nations gradually to the highest degree of association; inviting them to commerce by variety of climate, soil, and productions; and by overflowing population, by superabundance of capital and talents, it leads them to emigration and the founding of distant colonies. International trade, by rousing activity and energy, by the new wants it creates, by the propagation among nations of new ideas and discoveries, and by the diffusion of power, is one of the mightiest instruments of civilization, and one of the most powerful agencies in promoting national prosperity.

The association of nations, by means of trade, is even yet very imperfect, for it is interrupted, or at least weakened by war or selfish measures on the part sometimes of one and sometimes of another nation.

A nation may by war be deprived of its independence, its wealth, its liberty, its constitution, its laws, of its own special features, of that degree of culture and national well-being to which it may have attained; it may be wholly enslaved. Nations are thus the victims of each other, and selfish policy is continually disturbing and delaying the economical development of nations.

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