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Y205: Exploration, Encounters and Empire 1445–1570

Impact of overseas empire on Europe: bullion, the price revolution and European trade

  • 3 things to know
  • Unit group 2

Overview

Recall questions on the scale of bullion imports, the quinto real and treasure fleets, silver and Habsburg war, the price revolution, Seville and Lisbon, Spanish industry, the Cape route and the northern distribution centre.

What you need to know

Answer each one before you reveal it.

Your recallNot started
Evaluation

Why did the flow of bullion change scale after the mid-1540s?

Who and when

Why did Spain's own industry fail to profit fully from the colonial trade?

Who and when

How did the crown protect and use the treasure shipments?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Why did the flow of bullion change scale after the mid-1540s?

    Model answer

    The silver mountain of Potosí was opened in 1545 and Zacatecas in 1546, and the introduction of mercury amalgamation in the 1550s made low-grade ore profitable, so silver replaced gold as the main treasure and arrived in far greater quantities.

  2. 2

    Define the quinto real.

    Model answer

    It was the royal fifth, the crown's twenty per cent share of all bullion produced in the Indies, collected before any private consignment could be released.

  3. 3

    How did the crown protect and use the treasure shipments?

    Model answer

    Ships were required to sail in escorted convoys between Seville and the Indies, and the expected treasure was pledged in advance to Genoese and German bankers as security for the loans that paid the Habsburg armies.

  4. 4

    Explain the link between American treasure and Habsburg warfare.

    Model answer

    Silver did not pay directly for war so much as underwrite credit: it let the crown borrow far beyond its ordinary income, and it was the failure of that credit, when interest outran revenue, that produced the suspension of payments in 1557.

  5. 5

    Define the price revolution.

    Model answer

    The long sixteenth-century rise in prices across western Europe, sharpest in Spain, in which food prices in particular climbed steadily and money lost value.

  6. 6

    How did contemporaries explain rising prices, and what qualification do historians add?

    Model answer

    Scholars at Salamanca argued that money had become abundant while goods had not, so prices rose; historians add that population growth, harvest failure and coinage debasement also drove prices, and that inflation had begun before the great silver imports.

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