Autarky Defined: 3 Elements of Autarkies

An autarky is a nation with economic self-sufficiency that does not participate in any form of globalization. Autarkic nations practice self-reliance, depending on no other countries for trade and mobilizing their economic growth. In reality, autarky is challenging to achieve because of the nature of the global economy. Many economists view autarky as protectionism or extreme economic nationalism.

Politics and economics shape the definition of “autarky,” which traces its etymology to the Greek word for “autos” (meaning “self”) and “arkein” (meaning to “ward off” or “suffice”). Autarky is sometimes written as “autarchy,” though that word can also be a synonym for “autocracy,” a different form of politics in which a single person holds absolute power.

Some nations have attempted to become autarkies, though none have fully achieved this status.

• Populism: Nazi Germany and North Korea represent historical and present examples of autarky with attempts to meet it. Nazi Germany, leading up to and during World War II, embraced populist views and attempted to limit free trade to keep all money and economic activity within.
• Juche: Today, North Korea skews toward this economic system, though even that nation still relies on some international players. Nonetheless, North Korea practices Juche, an ideology positing that countries only become self-reliant by achieving political, economic, and military independence.
• War: Sometimes, the political economy forces countries into becoming an autarky. Because of its war in Ukraine, the world economy has largely cut off Russia through sanctions. Still, because countries rely on Russian oil and other exports, Russia is not entirely an autarky.

Economists may recognize an autarky by the following identifiers:

1. 1. Autarkic price: The autarkic price refers to the price of goods in an autarky, simply the price of creating the product itself. If that cost is higher than other nations for the same good, the autarky loses a competitive advantage and must suffer the sunk cost.
2. 2. Economic independence: Autarkies achieve economic freedom by growing, producing, and selling all goods within the nation. No international trade is permitted.
3. 3. Nationalism: Autarkies often exude a nationalistic spirit, where there is great fear of or resistance to outsiders. The nation is held high above all else, which is why this economic status can easily veer into protectionism.

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