Price Inflation in 16th-17th Century Europe

The most widely attributed cause of the European price inflation in the sixteenth and early-seventeenth centuries in Europe is the massive export of American treasure (gold and silver from Central and South America) to Europe--primarily Spain (Hamilton, 1965). The phenomenon has, however, been attributed to many other causes by both modern and contemporary historians, and economists, and by contemporary politicians and writers (Challis, 1971; Helleiner, 1959; Malowist, 1972; Miskimin, 1975; Phelps Brown & Hopkins, 1959; Spooner, 1972).

Some economic historians have even suggested that the price increases in Europe in the sixteenth and early-seventeenth centuries did not even constitute a real economic revolution,

because they were relatively mild by modern standards (Gould, 1964), and because they were, at least in part, a part of a long-range trend (Cipolla, 1972).

Thus, while there exists little dispute as to what prices did in sixteenth and early-seventeenth century Europe, considerable dissension exists as to both the causes and the relative severity of the inflation. These disagreements provide the justification for this current examination.

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ion, the out of hand dismissal of contemporary explanations appears to be equally unjustified, and a good deal more cavalier. Alternative Explanations Most of the alternative explanations of the price inflation in sixteenth and early-seventeenth century Europe recognize the validity of the claim that the importation of American gold and silver was a significant causal factor, although they do not accord that phenomenon a central causal role. Many of the alternative explanations also either incorporate or elaborate on some of the contemporary explanations of the inflation phenomenon as significant contributors to the rise in price levels in sixteenth and early-seventeenth Europe. Some of the more significant of the alternative explanations are considered in the discussions which follow. Population General population levels in Europe increased dramatically in the sixteenth century (Hamilton, 1965). Many modern economists view this population increase as a significant contributor to the price inflation of the sixteenth and early-seventeenth centuries (Gould, 1964), and they are able to cite Adam Smith as support for their contentions. The defeat by the British of the Spanish Armada in 1588, to an extent, opened the way fo
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Approximate Word count = 3258
Approximate Pages = 13 (250 words per page)