State, representative institutions and economic reforms in times of decline: royal taxation and trade policy in Aragon (1626-1700)

This article explores fiscal and trade policy in Aragon between 1626 and 1700, providing a case study of economic management by regional institutions in a composite monarchy of the early modern period. The increasing burden and irregular distribution of royal taxation hastened economic decline in seventeenth-century Aragon. Eventually, the monarchy moderated its fiscal demands in 1678–1697 to alleviate the financial dis- tress of the region’s towns and villages and cure the economic ills caused by protec- tionist trade policies in north-eastern Spain. The Aragonese Parliament only lowered royal subsidies after 1678, though it began to raise import duties as early as 1626 to ease the pressure on heavily indebted municipal treasuries. However, conflicting regio- nal interest groups undermined the Cortes’ economic policies, and their main effect was to drive up transaction costs without preventing French control of trade and manufac- turing in Aragon in the second half of the seventeenth century. In contrast, the free- trade policies pursued by the Diputacio ´n were more consistently applied and enjoyed greater legal and political support, fostering export-led agricultural specialization from which the elites were able to profit, although they failed to deliver long-run economic growth