A pax monetaria? Dilemmas of the portuguese monetary system under the habsbourgs (1580-1640)

ABSTRACT

In the seventeenth century, the monetary phenomenon was central to the understanding of the economy. Notably, in the Iberian World, where the flows of metals of America demanded a position on their impact on the mercantile and productive activities, and their articulation with the overseas trade and the management of the colonial economies. This work tries to understand the dilemmas of the monetary policy of the Habsburgs for the kingdom and the Empire of Portugal. The Union of 1580 maintained, in addition to the “laws, styles, freedoms, exemptions, royal house and offices” of the Portuguese Crown, the Portuguese currency. Thus, Philip II allowed his exclusive right to coinage to be interpreted in the same key of the conservation of the economic and juridical identity of Portugal. Throughout the period, the Philips did not change the value of the Portuguese currency, stabilizing the exchange rate of the real against the other European units of account. The large arrival of American silver, on the other hand, allowed the expansion of the monetary mass in Castile that ended up intoxicating the Portuguese circulating medium. This unstable arrangement puts the foundations for the transformation that will follow in the Restoration period, with successive monetary devaluations.

Keywords:
monetary history; Portugal; Iberian Union; monetary policy