Mercantilism was the dominant economic theory of the colonial era. Most early mercantilists assumed that the basis for national wealth was bullion, a finite resource, and that nations competed to gain bullion at their rivals’ expense. Mercantilism assumed an activist government and a self-sufficient country. British mercantilism was defined by Thomas Mun of the British East India Company in the 1620s. Mun agreed with the general notion that the mercantile nation should develop domestic or colonial sources for all of its needs agricultural products, raw materials, and finished goods. It needed a strong merchant marine, preferably armed, to control colonial trade. For orthodox thinkers, trade meant especially the bullion trade for mercantilist nations fortunate enough to have gold and silver mines. Previously, British mercantilism had entailed a significant amount of state-sponsored piracy. Mun eased the pressure to acquire hard metal by pointing out that, for those without direct access to bullion, a favorable balance of trade was a means of acquiring the wealth of other mercantilists. Mun argued that bullion outflows could be beneficial if they resulted in favorable trade balances. This approach reduced but did not eliminate the fixation with bullion as the basis of national economic health. Control of trade predated mercantilism. In medieval Europe, local governments assessed tolls or tariffs on goods entering or leaving their areas of control. Under mercantilism, the internal trade barriers between different parts of a country gave way to centralized government and international trade controls. The major mercantilist powers were England, France, Holland, and Spain. All attempted to restrict colonial trade to the home country. These nations wanted colonies that could provide materials and products needed in the home country. In return, they wanted colonies that needed products made in the home country, as well as colonies that operated at a deficit. Colonies received subsidies for production of raw materials, while restrictions and penalties were placed on manufactures that competed with the home country. Manufacture of these products for local use was acceptable, unless it interfered with the market for European imports. Colonial trade with other European nations was permissible when it brought advantage to the home country, in the form of bullion or a favorable trade balance.