Chapter 3- Economic And Financial Issues 1492-c.1500

Question 1

How did the crown often pay off debts?

Answer 1

They often paid off debts with the use of juros, which were a kind of state loan, offered to known and reliable supporters of the crown, and repaid at 10% interest.

Question 2

What was the Alcabala?

Answer 2

The crowns biggest source of revenue, first introduced in 1342 and initially collected by tax farmers, later devolved to the nobles.

Question 3

What problems did the Alcabala cause?

Answer 3

Cities could pay a lump sum, instead of the individual citizens contributions, which was called the ecabezamiento. These changes meant that the crown lost a regular flow of income which, in turn, meant it was less able to regulate its finances in a systematic manner.

Question 4

What were the most common taxes in Ferdinand and Isabella’s reign?

Answer 4

-The alcabala, a sales tax providing approximately 90% of income from taxation.
– Customs duties, a tax of 19%, maritime trade.
–Servicio y Montazgo, The Mesta paid for the movement of sheep.
– Salinas, salt production.
–Tercias Reales, 2/9 of the ecclesiastical tithes, granted by the Pope to the monarchs for their part in the war against Islam from 1494.
-Extraordinary taxation, granted by the Cortes e.g. servicios, which raised money for war: payments made by Christians for indulgences; poll taxes from males over 16 who owned property.

Question 5

What were the possible reasons for the crown being in debt?

Answer 5

An increase in Miller Terry expenses, tickly as a result of the war in Granada. Increase in household expenses because the monarchs developed their court to demonstrate their status. Although this was necessary in terms of preserving their thrones and their status abroad as well as internally.

Question 6

What were the incomes of the crown during the period 1492 to 1500?

Answer 6

Figures quoted in G. Woodward, 1997, suggest that income for the crown in this period had increased. On their accession, Ferdinand and Isabella were struggling; the income of 11 million Maravedis that they received in 1474 was approximately 1/7 of the expected amount. This had, however, increased to 269 million in 1496. Despite these later increases, the crown are still not financially strong; some nobles had greater incomes than the crown.

Question 7

What were officers often guilty of that affected the finances of the crown?

Answer 7

They were often negligent or often simply guilty of embezzlement, which is diverting money from the taxes for their own use. This could be done by altering figures on the records. An investigation suggested many taxes had just not been collected.

Question 8

What are two reasons why income did not meet expenditure?

Answer 8

Tax farming; system whereby individuals bought the right to collect taxes. They then charged more when they made their collections so that they could make a profit. In addition, The tax system was regressive; wealthy paid less than the middle and lower classes.

Question 9

What evidence was there that there was an attempt to improve the situation financially?

Answer 9

There was an attempt to keep more detailed records but changes were marginal and slow.

Question 10

What factors were there for the shortfall in income for the crown?

Answer 10

– The nobles continued to collect mercedes, royal grants, even though they were not entitled to them.
– Many of the profits of other taxes still did not reach the Treasury.
- A large number of potential tax payers for example the clergy, where exempt from the Alcabala sales tax.
- the ecabezamientos paid by towns that had been fixed in 1495 and not changed since.

Question 11

What did Elliot see the nobles as benefiting from?

Answer 11

From the land made available to them and from the right to establish entails, thus being able to pass on their land and possessions to their heirs. 97% of the land in Castile belonged to 3% of the population.

Question 12

What were some of Spain’s existing trades?

Answer 12

Silverware, silk, leather, Ironwork

Question 13

What were some of Spain’s existing trades?

Answer 13

Soap,cloth, ceramics and wine. However they remained fairly small scale and were often hampered by regulations. For example this applied particularly to the Granadan silk which was often in short supply.

Question 14

What was a more positive long-term development for the economy?

Answer 14

The voyages of Christopher Columbus and his discovery of what was to be known as America. The papal bull, Inter Caetera, in 1493, had given Spain right to territory in South America and was significant later as trade developed more fully.

Question 15

What are some positive developments that happened to the economy in this period?

Answer 15

– Castile sought to improve methods of communication and transport by giving privileges to the Carters girls.
- Aragon developed a successful postal operation Barcelona.
– The progress and cooperation between the two monarchs brought a degree of peace to Spain and allowed to the economy to develop and flourish.
-trade was controlled by the monarchs through licensing and they encouraged it through fairs.

Question 16

What negative aspects of the economy still remained?

Answer 16

Tolls on bridges, ports and frontiers remained between the different kingdoms.

Question 17

What was the Mesta?

Answer 17

They supervised sheep farming and was a kind of guild or trade union. It was formed originally in the 13th century. A Royal Council that was appointed as the president of the Mesta in 1500, demonstrating how important the Monarch’s it to be as a part of the economy. Controlled approximately 2.8 million sheep.

Question 18

What caused clashes between herdsman and landowners?

Answer 18

In 1501, sheep farmers in Castile were given the right to graze their sheep on any land is where sheep had previously grazed. Local magistrates who often solved the conflicts were usually in favour of the herdsmen. In Aragon however sheep were not always allowed to move through cultivated land.

Question 19

What was Castile’s main export?

Answer 19

Wool. Trading organisation- Consultado who carries out and regulated trade. Port of Burgos given monopoly in export of wool. Consultado acted both as a guild and a court where complaints could be brought. The Mesta gave the monarchs a monopoly of the wool trade overall, which allowed them to extend the tax on a herd of sheep into a tax per sheep.

Question 20

How did the catholic monarchs encourage the wool trade’s development abroad?

Answer 20

By appointing agents in European cities such as Bruges who would then liaise with the Mesta to promote trade.

Question 21

What was the most important trade fair in Castile where wool was sold?

Answer 21

Medina del Campo

Question 22

What negative aspects came out of the over reliance on sheep?

Answer 22

Had a detrimental effect on agriculture, causing shortages of food and creating an imbalance in the economy. This was particularly so in Castile were approximately 90% of the land was owned by less than 3% of the population.

Question 23

How did the Mesta benefit the crown?

Answer 23

Their contribution to the economy of Spain overall resulted in benefits for the ports of northern Spain, such as Santander and Corunna. Is was also a good source of revenue for the crown.

Question 24

What happened in the period up to 1500?

Answer 24

Gradually more food was produced as waste pastures and common land were brought back into use as arable land. This was needed as population increased.

Question 25

What was the sentence of Guadalupe in 1486?

Answer 25

In 1500 the monarchs agreed to free up trade in grain and was part of the sentence of Guadeloupe. Was the consequence of a peasants rebellion in the same year.

Question 26

What were the terms of the sentence of Guadeloupe in 1486?

Answer 26

– Peasants were given ownership of their land following payment of a considerable sum for the privilege.
– Produce could be sold freely with the exception of wheat sales to Muslim territories, this structure was relaxed in 1500.
– Taxes could be suspended when, e.g., harsh weather conditions hindered crops growing.
-Exports were allowed when crops were plentiful.
Even so there were still food shortages and population grew and this became worse early years of the 16th century. This provoked tension and sometimes overflowed into conflict.

Question 27

What is the view that the economy during 1492 to 1500 developed along mercantilist lines?

Answer 27

This theory suggests a highly organised system run by the government with clear ground rules e.g. promoting national industries rather than importing goods, regulating producers, prohibiting the export of gold and silver and imposing customs duties on goods coming into the country. For example duties were imposed in 1498 on French cloth imported into Spain.

Question 28

What is the alternative view on the economy during this period?

Answer 28

Describes development as more piecemeal and inconsistent, e.g. there were still many internal tolls to cross bridges or take good through ports; these impositions clearly increased the price of the locally produced goods.

Question 29

What was the positive development made during this period?

Answer 29

Attempt was made to standardise the currency across the territories of the new monarchs.