Geography Reference
In-Depth Information
into one of the largest cities in the world; in 1600, it had 160,000 inhabitants,
rivaling London, Seville, or Amsterdam (Pomeranz and Topik 1999). Potosí's
global importance is instructive: half of the New World's silver
flowed from
this one mine, in which two to eight million Aymara Indians perished horribly.
New World silver became the primary specie integrating the mercantile world
economy and essentially allowed Europe to “buy itself a ticket on the Asian
train” (Frank 1998:xxv): “from 1493 to 1800, 85% of the world's silver and
70% of its gold came from the Americas” (p. 143). TePaske (1983:425) notes
“American silver was so ubiquitous that the merchants from Boston to
Havana, Seville to Antwerp, Murmansk to Alexandria, Constantinople to
Coromandel, Macao to Canton, Nagasaki to Manila all used the Spanish peso
or piece of eight (
real
) as a standard medium of exchange.” Given Europe's
large trade de
fl
cits with Asia, two-thirds of European payments for Asian
imports consisted of precious metals. From Spain, silver
fi
flowed to England,
France, and the Netherlands to purchase manufactured goods, where much
of it went to Russia to
fl
fi
finance imports of furs (Figure 3.1). Russian silver, in
turn,
flowed along the Volga River to Persia. Spanish silver also found its
way directly to the Ottomans and thence to the Indian Ocean. Much of the
Mughal Empire in India was
fl
financed by silver, a considerable portion of
which went to purchase horses from central Asia. Indian silver also
fi
owed
through Malacca to China, or at times overland via the Silk Road routes. At
the easternmost end of this network, China, in which the Ming dynasty was
remonetizing the economy from paper to silver, was the “sink” for ½ to ¾ of
the world's silver
fl
. Thus, “without China,
there would have been no Potosí” (Marks 2007:80). Indeed, the seventeenth
century witnessed a broad
fl
ows between 1500 and 1800
ad
financial crisis across eastern and southern Asia
associated with this restructuring (Perlin 1986; Richards 1990). When Spain
established its Manila colony in the Philippines in 1571, it became possible,
for the
fi
first time, for New World silver to travel back to Europe in two
directions, that is, in galleons across both the Atlantic and Paci
fi
fi
c Oceans.
financial
instruments everywhere, including credit, loans, bills of exchange, paper
money, bonds, and negotiable obligations, greatly increasing the liquidity and
velocity of money and accelerating production. In Europe, this process saw a
steady climb in prices; in Asia, the supply of countless goods rose to meet
increased Western demand, inhibiting in
The e
ff
ects of the silver economy included a rapid growth in
fi
ation. Silver also drew the econ-
omies of disparate places together like no phenomenon had before, intertwin-
ing their economic fate in a series of boom and bust cycles. For example,
“The peak of the Southeast Asian trading boom from 1580 to 1630 coincided
with and was also generated by the simultaneous economic expansions in and
demand by Japan, China, India, and Europe” (Frank 1998:96). Conversely,
the decline in silver exports from the New World simultaneously led to the
erosion of the Spanish Hapsburg Empire and the Western balance of trade
with China, a de
fl
cit ultimately corrected by the British injection of opium
in large quantities. In short, the earliest waves of time-space compression
fi
Search WWH ::
Custom Search