Capitalism Replaces Mercantilism

Capitalism generally refers to an economic system in which the means of production are mostly privately owned and operated for profit, and in which distribution, production and pricing of goods and services are determined in a largely free market.
Mercantilism is an economic theory that holds the prosperity of a nation depends upon its supply of capital, and that the global volume of trade is "unchangeable." Capital, represented by bullion (gold, silver, and trade value) held by the state, is best increased through a positive balance of trade with other nations (exports minus imports). Mercantilism suggests that the ruling government should advance these goals by playing a protectionist role in the economy, by encouraging exports and discouraging imports, especially through the use of tariffs. The economic policy based upon these ideas is often called the mercantile system.
Wealth of Nations was written by Adam Smith in 1776.
The book has sometimes been described as a critique of mercantilism, the economic system used in Europe at the time.
wealth of nations attacks:
The idea that protectionist tariffs serve the economic interests of a nation (or indeed any purpose whatsoever) and
The idea that large reserves of gold bullion or other precious metals are necessary for a country's economic success.
The invisible hand is a metaphor invented by Adam Smith to illustrate how those who seek wealth by following their individual self-interest, inadvertently stimulate the economy and assist society as a whole. Smith claims that an individual pursuing his own good tends also to promote the good of his community, which ensures that those activities most beneficial and efficient will naturally be those most that are profitable