Sixteenth-century Spain is ultimately the victim of…

1540 CE to 1683 CE

Sixteenth-century Spain is ultimately the victim of its own wealth.

Military expenditure does not stimulate domestic production.

Bullion from American mines passes through Spain like water through a sieve to pay for troops in the Netherlands and Italy, to maintain the emperor's forces in Germany and ships at sea, and to satisfy conspicuous consumption at home.

The glut of precious metal brought from America and spent on Spain's military establishment quickens inflation throughout Europe, lefaves Spaniards without sufficient specie to pay debts, and causes Spanish goods to become too overpriced to compete in international markets.

American bullion alone cannot satisfy the demands of military expenditure.

Domestic production is heavily taxed, driving up prices for Spanish-made goods.

The sale of titles to entrepreneurs who buy their way up the social ladder, removing themselves from the productive sector of the economy and padding an increasingly parasitic aristocracy, provides additional funds.

Potential profit from the sale of property serves as an incentive for further confiscations from conversos and Moriscos.

Spain's apparent prosperity in the sixteenth century is not based on actual economic growth.

As its bullion supply decreases in the seventeenth century, Spain is neither able to meet the cost  of its military commitments nor to pay for imports of manufactured goods that cannot be produced efficiently at home.

The overall effect of plague and emigration reduces Spain's population from eight million in the early sixteenth century to seven million by the mid-seventeenth century.

Land is taken out of production for lack of labor and the incentive to develop it, and Spain, although predominantly agrarian, depends on imports of foodstuffs.

Locations
Madrid Madrid Spain View →

Groups
Dutch people View → Sardinia, Kingdom of View → Portugal, Avizan (Joannine) Kingdom of View → Netherlands, Habsburg View → Christians, New View → Moriscos View → Naples, Kingdom of View → Spaniards (Latins) View → Spain, Habsburg Kingdom of View → Pavia, (Spanish-ruled) Commune of View → Spain, Habsburg Kingdom of View → Portugal, Habsburg (Philippine) Kingdom of View → Iberian Union View →

Topics
Colonization of the Americas, Portuguese View → Colonization of the Americas, Spanish View → Spanish Golden Age View → Spanish Plague of 1596-1602 View → Spanish Plague of 1676-1685 View →

Commodities
Grains and produce View → Strategic metals View → Money View → Land View → Manufactured goods View →

Subjects
Faith View → Government View → Custom and Law View → Finance View → Economics View →

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People: Niall of the Nine Hostages
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