ECONOMIC INTERDEPENDENCE

As we have seen in the discussion in Chapter 5 of the relationship between inter-colonial trade and the Carrera de las Indias, and in Chapter 6 of the economic significance (in terms of both the generation of contraband and increased local defence expenditure) of foreign commercial and territorial penetration of America in the seventeenth century, any attempt to isolate internal and regional economic activity in colonial Spanish America from either trans-Atlantic trade with Spain or illegal international commerce with other nations is difficult and in some respects artificial. Similarly, because of the complex social and economic inter-relationships which existed between entrepreneurs involved in mining, agriculture, industry and trade—prominent merchants, for example, tended to have important interests in land, and, not infrequently, in parts of Mexico and Peru in mining—separate analysis of these sectors can also provide a distorted, somewhat artificial reflection of actual social mechanisms, and of the fluid interactions that occurred between and within elite socio-economic groups. Despite these caveats, it is still legitimate for the historian to recognise, or at least seek to identify, the existence of an internal, American economy, which, while overlapping with the trans-Atlantic structure, also enjoyed a considerable degree of autonomy, especially from the middle of the seventeenth century, when the dependence of Americans upon the economic mechanisms of metropolitan Spain began to be eroded by economic decline in the peninsula and economic growth in America. This chapter aims, therefore, to provide a succinct overview of the principal characteristics of the development of the American economy during the period from 1550 until the demise of the Hapsburg monarchy in Spain.

MINING

The crucial part played by the search for precious metals in the pattern and intensity of colonisation in Spanish America has already been explained in some detail in Chapter 1, as have the reasons for the predominance of gold over silver in terms of their production (primarily by the melting down of precious objects) in New Spain until the late 1530s and in the central Andes until the mid-1540s, and, of course, in bullion shipments to Spain.