Question 19. Define the Physiocracy theory of trade .
Answer 19. Physiocracy is the collective name of those economic principles and policies which developed in France in the middle of the 18th century . Physiocracy is also known as the 'Agricultural System' . Economics thinkers who contributes to the growth and development of Physiocracy have been called as Physicrats. Physiocracy is also remarked as the first school of economics thought . The term physiocracy means 'Rule Of Nature ' .
Physiocracy may be defined as the reaction against Mercantilism and it's concept. The Physiocrates believe that the mercantile policies instead of doing any good have done great harm to the nation's. So they revolted against the mercantile policies.
Physiocracy was the revolt of the French people against Mercantilism . It is , from this angle, we have to judge the economic ideas of the physiocrates. While the Mercantilist were occupied with gold the physiocrats emphasized ' Real wealth ' in the form of raw produce .