What economic theory forbade manufacturing in the colonies in competition with the mother country?

The correct answer is mercantilism. This economic theory was dominant in the 16th to 18th centuries and emphasized the importance of a favorable balance of trade for the mother country. Mercantilism held that colonies existed primarily to benefit the mother country by providing raw materials and serving as markets for manufactured goods. Consequently, manufacturing in the colonies that could compete with products from the mother country was discouraged or outright forbidden. This was aimed at ensuring that the economic power remained concentrated in the hands of the ruling nation, thus promoting its wealth and influence.

In contrast, capitalism focuses on private ownership and the free market, allowing for competition without the constraints of mercantilist principles. Feudalism relates to a social and economic system prevalent in medieval Europe, where land ownership and social obligations dictated the economy, and socialism emphasizes collective ownership and egalitarian distribution of resources. Therefore, mercantilism is specifically tied to the historical relationship between colonial empires and their colonies, making it the correct choice.