The Impact of Free Trade in Peru, 1778-1796

Abstract

Beginning with a general discussion of Spanish trade with America in the period 1778-1796, the article then broaches the specific subject of whether free trade, though encouraging economic growth and the development of agriculture and mining, destroyed domestic industry. The author shows that, despite the pessimism prevalent in Lima's mercantile community and the rapid commercial expansion of the River Plate region, Peru continued to be Spain's most important market in South America during the last quarter of the eighteenth century, a period of readjusment and growth for the Peruvian economy, not of decadence.