The definition and meaning of autarky is the quality of a nation or economic system that is self-sufficient – non-reliance on imports or economic aid. If that nation were suddenly completely isolated from the rest of the world due to a trade embargo or natural phenomenon, it would still be able to survive and continue its activities. It is a closed economy – isolationist. The term may refer to a country or the system itself.
Autarky is a noun that refers either to the state of self-sufficiency or an entity that is economically self-reliant.
Autarky may be an economic state of total self-reliance that a government pursued and managed to achieve, or because the country is fortunate to have enough land and the right climate to feed itself, has plenty of natural mineral resources including oil, and a sophisticated economy.
Autarky is a utopia that does not exist, economists say. No nation has been able to produce the full range of goods and services demanded by its citizens at competitive prices. According to The Economist: “Those that have tried to do so have condemned themselves to inefficiency and comparative poverty, compared with countries that engage in international trade.”
The term does not always refer to an economic state. A military autarky is a country that is able to defend itself without outside help, or can make all the weapons it needs without relying on imports.
Autarky may mean the policy of the whole state or other entity when it tries to become generally self-sufficient, but can also be limited to a more narrow field, such as possession of strategic raw materials.
For example, most countries aim for autarky with respect to food production, power generation, and the availability of water for reasons of national security.
According to ft.com/lexicon, autarky by definition is:
“An ideal state of economic self-sufficiency based on an abundance of raw materials, food and other essentials.”
John William Snow, born in Toledo, Ohio, was once CEO of CSX Corporation and served as US Secretary of the Treasury under President George W. Bush from 2003 to 2006. He has served as a Director of the Association of American Railroads, The US-Japan Business Council, NationsBank Corp., and Circuit City Stores Inc. (Image: Wikipedia)
Etymology of autarky
Etymology is the study of the origing of words. According to the Online Etymology Dictionary, with the meaning self-sufficiency, autarky emerged in the English language in the early 1600s.
It comes from Greek ‘Autarkeia’, which means ‘sufficiency in oneself, independence’, which comes from Greek ‘Autarkes’, meaning ‘having enough, independent of others, self-sufficient’.
The Greek word ‘Autos means ‘self’, and ‘Arkein’ means to ‘keep off, ward off’, sufficient, to be strong enough’. Its source is not the same as ‘Autarchy’.
The adjective is ‘Autarkic’. An autarkic system is one that aims for total economic independence.
Autarky in since 17th century
Between the 1600s and early 1900s in the Dominican Republic, escaped and freed slaves as well as rural peasants lived in woodland in the interior of the island in virtually total isolation.
During the Edo Period, before its opening to the west in the 1850s, Japan was partially an autarky. The term Sakoku (鎖国) refers to that period of isolationism.
In the 17th and 18th centuries, mercantilism was a policy that the great empires of Western Europe pursued, limiting or banning trade outside the empire.
Countries that pursue a policy of autarky eventually fall behind other nations that trade internationally in virtually every statistic, especially citizens’ standard of living and the quality and range of products and services available at reasonable prices.
In 1808, US President Thomas Jefferson declared a self-imposed embargo on international shipping – the embargo lasted until 1809. The United States was emerging from the American Revolution and was wary of the military and economic might of Great Britain.
Nazi Germany had a goal of total self-sufficiency in the 1930s, which encouraged trade within its economic bloc and discouraged external trade, particularly with the then world powers – Soviet Union, France, United Kingdom – against which it expected to be fighting in a war.
Nazi Germany encouraged international trade only with countries – it saw as economically weak, such as those in Eastern Europe, the Balkans and South America – that had the raw materials it required for growth.
India pursued near-autarky in 1950 after its establishment as an independent state. That policy ended in 1991 after an alarmingly high number of bankruptcies.
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In 1976, the People’s Republic of Albania became a quasi-autarky, when Enver Hoxha, the Communist Party leader, instituted a policy of self-reliance. After Hoxha died in 1985, limited international trade resumed, and has expanded rapidly since 1991.
Under Francisco Franco, dictator of Spain – known in the Spanish-speaking world as El Caudillo – the country was an autarky from 1939 until he allowed international trade again in 1959. The resumption of trade coincided with the Spanish Miracle, a period of spectacular economic growth that lasted until 1974.
Ne Win, who ruled the Union of Burma from 1962 to 1988, pursued the Burmese Way to Socialism – a policy of autarky.
In the 1980s, Romania’s dictator Nicolae Ceaușescu proposed paying the country’s entire foreign debt and boosting the number of goods produced domestically. His aim was to drastically reduce dependency on imports, because his relationship with both the communist and Western leaders was deteriorating.
During the Apartheid era – from 1948 to 1991 – South Africa was forced into partial autarky due to economic sanctions from the international community.
Pure autarkies do not exist today. North Korea, whose government idealology is based on Juche (Chosŏn’gŭl: 주체; Hancha: 主體 – self-sufficiency), is a possible example of a country trying for total autarky. However, without aid from other countries, North Korea’s population would starve. The country also trades extensively with mainland China, Iran, Vietnam, Syria, and some European and African nations.
Autarky in other languages: autarquía (Spanish), autarquia (Portugues, no accent), autarchia (Italian), autarcie (French), Autarkie (German), автаркия (Russian), 自閉症 (Japanese), 自给自足 (Chinese), الاكتفاء الذاتي (Arabic), autarki (Indonesian, Norwegian), självförsörjning (Swedish), selvforsyning (Danish), autarkia (Polish), and 자비 (Korean).
Video – Autarky vs. international trade – Definition and Meaning
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