7. Economic changes in the 18th century

Talking Book

At the beginning of the 18th century, European economies had the same characteristics as in the earlier phases of the Ancien Régime. However, the reforms introduced by enlightened monarchs led to important changes in all sectors of the economy.

• During the 18th century, harvests improved for a number of reasons:
• new agricultural techniques, such as crop rotation, were more widely used, and improved agricultural machinery increased farmers' productivity.
• new crops were introduced, such as potatoes and corn. These improved human and animal nutrition.
• Craft production increased because population growth caused an increase in demand for many consumer goods. The guilds also had to compete with new systems of production.
• In rural areas, the domestic system of production became more important. Peasants made products in their own homes and sold them to merchants. This allowed them to earn extra income during times of reduced agricultural activity (autumn and winter).
• Royal manufacturers (also known as royal factories) produced various luxury goods. They were based in large workshops and their workers used simple tools.

Economic reforms in Spain

The Spanish economy experienced growth in the 18th century as a result of reforms introduced by Felipe V, Fernando VI and Carlos III. The sociedades económicas de amigos del país also played an important role, carrying out scientific, economic and technical studies, and then publishing the results.

Some of the most important reforms were in:

• agriculture – canals were built to facilitate irrigation (the Canal de Castilla) and uninhabited areas were colonised (the Sierra Morena).
• craft production – royal manufacturers were established for silk, porcelain and other luxury goods. Textile production in Cataluña was also protected from foreign competition.
• trade – internal customs duties were abolished. Cádiz lost its monopoly on transatlantic trade, allowing free trade with America.

Important

Enlightened despots, like absolute monarchs, supported the establishment of luxury-goods manufacturers. Royal palaces were decorated with objects made in the royal factories, including lamps, clocks, tapestries, rugs and porcelain. The nobility and wealthy bourgeois families also acquired the products that were made by the royal manufacturers.

Talking Book

THE TRIANGULAR TRADE​ Monarchs increased domestic trade by improving roads and building new ones. They also built canals to connect river systems and modernised ports. International trade grew due to increased exchanges of goods between Europe and the American colonies. During the 18th century, the Atlantic Ocean consolidated its position as the world's most important trading zone. The triangular trade routes between Europe, Africa and America were controlled by the British. Trade routes in the Indian Ocean were controlled by Great Britain, France and the United Provinces. The Dutch and British drove the French out of India in 1763. In the following century India would become one of the British Empire's most valuable possessions. This European expansion of global trade was carried out through private companies, such as the British East India Company. The crown granted these companies monopolies, which gave them exclusive control over trade in a particular area.