Doesn't the idea of profiting from tarriffs illustrate the differences between free trade and mercantilism? If you set a high rate, then merchants would leave but also the market would be less attractive; perhaps an inverted multiplier to reflect the efficiency of the market. The example could be if you set the tarriff rate too high, then the overall size of the market would decline by a percentage of say 0-50% (due to smuggling, under-development, etc.).
Conversely - if you set the tarriff relatively low, then the competition could be theoretically greater. The advantage would be that you have a potentially more profitable CoT; especially if you get an monopoly.
As a side note; I could see a protectionist/mercantile CoT having a higher risk of defections from the provinces that supply it when a new CoT emerges.
Conversely - if you set the tarriff relatively low, then the competition could be theoretically greater. The advantage would be that you have a potentially more profitable CoT; especially if you get an monopoly.
As a side note; I could see a protectionist/mercantile CoT having a higher risk of defections from the provinces that supply it when a new CoT emerges.
