# National Prejudice and Animosity in Trade ## Definition The emotional and political factors that influence trade policy, where merchants and manufacturers promote restrictions against foreign competitors based on nationalistic sentiments rather than economic reasoning, leading to mutually harmful trade wars. ## Source Chapter Book IV, Chapter 3 ## Context Smith identifies this as a primary driver of unreasonable trade restrictions, arguing that merchants exploit national prejudices to secure monopolies and that governments foolishly adopt these policies based on animosity rather than economic self-interest. ## Economic Domain Regulation ---