Table Of ContentPALGRAVE STUDIES IN ECONOMIC HISTORY
Between Empire
and Globalization
An Economic History
of Modern Spain
Albert Carreras
Xavier Tafunell
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London School of Economics
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Albert Carreras • Xavier Tafunell
Between Empire
and Globalization
An Economic History of Modern Spain
Albert Carreras Xavier Tafunell
Department of Economics Department of Economics
and Business and Business
Pompeu Fabra University Pompeu Fabra University
Barcelona, Spain Barcelona, Spain
Based on a translation from the Spanish language edition: Entre el imperio y la
globalización: Historia económica de la España contemporánea by Albert
Carreras and Xavier Tafunell Copyright © Editorial Planeta S.A 2018 All Rights
Reserved
ISSN 2662-6497 ISSN 2662-6500 (electronic)
Palgrave Studies in Economic History
ISBN 978-3-030-60503-2 ISBN 978-3-030-60504-9 (eBook)
https://doi.org/10.1007/978-3-030-60504-9
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P
reface
Has Spain grown in the last two centuries? Yes, a lot. Has Spain converged
on its neighbours, the countries of Western Europe? It depends. The time
period under consideration is essential. Within the last sixty years conver-
gence has been spectacular. If we go back two centuries or more, not at all.
In this book we deal in detail with economic growth and convergence
and the permanent tension between the two when assessing historical
experience since the industrial revolution. The central issue of the Spanish
economy from the late eighteenth century to the early twenty-first century
is the convergence or divergence with respect to the Western European
pattern.
The basic problem is, of course, that of non-convergence. Despite all
the growth, which allows Spain to be much more prosperous than in
1800—twenty times—Spaniards are as far away from their neighbours as
they were more than two centuries ago. The torturing sense of “failure”
or “backwardness” has dominated generations of Spaniards. From the
romantics to the regenerationists, from the right to the left, from the capi-
tals to the peripherals, and for many economic historians from all around,
the question remains: why has Spain not come to homologate to Western
Europe? Our judgement will be nuanced, as there have been periods of
strong convergence. We aim to clarify which policies have not helped to
converge, and which ones have. Our main characters are five: institutional
change, capital formation (physical and human), structural change, inter-
nationalization and State action. All these factors and trends force atten-
tion to be drawn to the economic policies deployed throughout the
v
vi PREFACE
modern age and force a chronological approach, because human action
unfolds over time.
We propose, indeed, a rigorously chronological journey through the
economic history of modern Spain, always with an eye opened to what
happens in the international economy. Chapter 1, “The Economic Growth
of Spain: A Very Long-Term Perspective”, is dedicated to a long-term
overview, and justifies our chronology. The rest is the temporary flow of
the economy. The chapters on the first periods—Chap. 2, “From Empire
to Peripheral Economy (1789–1840)”, during the crisis of the Old Regime
and the Liberal Revolution; and Chap. 3, “The Impact of European
Industrialization: the Double Failure of Agrarian and Industrial Strategies
(1840–1890)”—are longer, in line with the chronological framework con-
sidered—about fifty years each. From 1890, the next half century, until
the outbreak of the Civil War, is covered with two other chapters of similar
length and chronological spread: Chap. 4, “Spain in the First Economic
Globalization (1890–1914)”; and Chap. 5, “The Spanish Economy
During Great War and Interwar Years (1914–1936)”. The next five chap-
ters study shorter periods, between eight and fifteen years long, from
1936 until 1998: Chap. 6, “The Isolation from the International Economy:
Civil War and Autarky (1936–1951)”; Chap. 7, “Import Substitution
Industrialization (1951–1959)”, Chap. 8, “Spain in the Golden Age:
Reintegration into the International Economy (1960–1973)”; Chap. 9,
“Economic Crisis and Political Transition (1973–1985)”; and Chap. 10,
“Integration into the European Economy (1986–1998)”. The last piece
of the chronological sequence is longer as it deals with the twenty years of
the Spanish economy without monetary sovereignty, which is dealt with in
Chap. 11, “Spain in the Euro Area (1999–2017)”. The final chapter,
Chap. 12, “Balance of Two Centuries: Growth Engines and Economic
Policies”, formulates a balance of long-term results in terms of growth
factors and economic policies. It includes a reminder of our main inter-
pretative lines: the importance of commercial policy—as the greater the
opening the better the performance of the Spanish economy—and the
importance of State’s action as a propellant or brake of growth, depending
on its financial equilibrium. Monetary policy has a crucial role in address-
ing the recurrence of twin deficits. A final consideration is made on the
distributional impact of Spanish growth and policies and we close with a
reminder of institutional changes along the whole time span considered,
from Empire to globalization.
PREFACE vii
To give coherence to the temporal sequence, we have prepared a quan-
titative appendix with twenty-four very significant macroeconomic series
to which we repeatedly resort, such as GDP per capita, prices, investment
quota and degree of openness, to name a few, that in some occasions are
compared with most of Western Europe (those countries that for the years
before 2004—the East enlargement—formed the European Union). In
economic history this information is continually being reworked, but in
the Spanish case it has acquired an enviable solidity that allows us to bet
on the stability of the overall vision. The changes may come—and are
coming—from the international coupling of the Spanish experience.
Indeed, we underline that the economic history of modern Spain is forged
in the collapse of the American empire, and that this starting point, of an
intrinsically international nature, is essential to understand everything that
happens later, as is the industrial revolution and the subsequent diffusion
of industrialization, the first economic globalization, the great world wars
of the first half of the twentieth century and the strong trend towards
economic isolation, the impact of European economic growth and inte-
gration or the strong economic globalization in which we are fully
immersed and that completely conditions the future of the Spanish econ-
omy. Between that great imperial space, completely protected, and this
current world space in which distance barely counts, all parameters have
changed, starting with the fundamental represented by the change of
expectations about what the future can hold for us. All these great histori-
cal phenomena require a better fitting of the Spanish economic history
into the European and world economic history. It is worth mentioning
that the comparison with the average world experience provides the more
optimistic comparative assessment of long-term economic performance,
even if this new-century developments are disappointing for Spain.
Our text is focused on the presentation of the economic history of
Spain in response to the challenges that have seemed central to us, namely
economic growth and convergence or divergence. We have been inter-
ested in the mechanisms that drive growth and the problems of economic
stability that can derail growth policies such as the price level, the public
finances, the foreign sector and the market for factors. This does not mean
that we despise other themes, quite the contrary. In several cases we have
left them aside because there were very satisfactory texts already available.
This is the case, for instance, regarding the regional approach and the
sectoral approach. For the regional we have a complete regional economic
viii PREFACE
history of Spain, in addition to other works on similar themes.1 We have
consciously set aside this approach, mentioning it only briefly at some
relevant moments and in some bibliographical notes. The studies on sec-
tors, both agricultural and industrial, have been numerous and of high
quality, as is the case, for example, of the Industrial Atlas of Spain and the
huge literature on agrarian history.2 In our text we have focused our atten-
tion on specific sectors only according on the intensity of the contribution
of each sector—whether positive or negative—to growth and stability.
Nor have we incorporated more than exceptionally business history, which
enjoys excellent academic health reflected in texts such as a business his-
tory of Spain using a regional approach.3
Inevitably, we concur with other texts that aspire to cover the same field
and in the same language. Those of Joseph Harrison (1978), Nicolás
Sánchez-Albornoz, ed. (1987), Pablo Martín Aceña and James Simpson,
eds. (1995), David Ringrose (1996), Gabriel Tortella (2000) and Joseph
Harrison and David Corkill (2004) are particularly significant.4 We offer
our point of view and our content organization, but we have taken them
fully into account in our more chronological argument. The reader will
not find everything he or she would like to know about the economic his-
tory of modern Spain. The bibliographical essays at the end of each chap-
ter offer some indications of where you can continue studying and learning,
1 Luis Germán, Enrique Llopis, Jordi Maluquer de Motes & Santiago Zapata, eds., Historia
económica regional de España. Siglos XIX y XX, Editorial Crítica, 2001, and Alfonso Díez-
Minguela, Julio Martínez-Galarraga and Daniel A. Tirado-Fabregat, Regional inequality in
Spain: 1860–2015, Palgrave Macmillan, 2018.
2 Jordi Nadal, Josep Maria Benaül & Carles Sudrià, dirs., Atlas de la industrialización de
España, 1750–2000, Fundación BBVA y Editorial Crítica, 2003. Both industrial history and
agrarian history have well established specialized academic journals: Revista de Historia
Industrial and Historia Agraria.
3 José Luis García Ruiz & Carles Manera, dirs., Historia empresarial de España. Un enfoque
regional en profundidad, Editorial LID, 2006.
4 Joseph Harrison, An economic history of modern Spain, Manchester University Press,
1978, Nicolás Sánchez-Albornoz, ed., Economic modernization of Spain, 1830–1930,
New York University Press, 1987, Pablo Martín-Aceña and James Simpson, eds., The eco-
nomic development of Spain since 1870, Edward Elgar, 1995, David R. Ringrose, Spain,
Europe and the “Spanish Miracle”, 1700–1900, Cambridge University Press, 1996, Gabriel
Tortella, The development of Modern Spain: an economic history of the nineteenth and twentieth
centuries, Harvard University Press, 2000 and Joseph Harrison and David Corkill, Spain: a
modern european economy, Ashgate, 2004.
PREFACE ix
especially in those areas that are being subject of intense research such as
territorial inequality or inequality in income distribution. In both cases we
acknowledge the main contributions that are being published in major
international journals of economic history, but we do not introduce them
in our central argument. On the other hand, and from many points of
view our book is complementary to that of Leandro Prados de la Escosura,
Spanish Economic Growth, 1850–2015, 2017 in this same publisher and
collection.5 The continuous production of new data, new series or updated
series by Leandro Prados de la Escosura has challenged and inspired us
and we have provided interpretative frameworks in which to fit, explain
and make sense of his systematic historical quantification. Many other col-
leagues have produced extremely valuable research or synthesis, and we
refer to them in our bibliographical essays.
The book is intended for a non-expert audience. We have shunned the
erudition—the book is not annotated—and the debates, except in some
sections that report and assess the different existing interpretations on
particularly controversial aspects that have continued to be so despite the
new research carried out. As there is a longer version of the original edi-
tion in Spanish, we have shortened the contents on which we could not be
as conclusive as in the basic convergence/divergence scheme and its
causes, or that were less relevant to this object. We have also compacted
the texts, tables and figures, lightening them whenever possible. The con-
tents of first and last chapters have been reorganized.
The authors have always been committed to propose to the readers new
visions of the economic past of Spain based on the principle of quantitative
and chronological continuity between the remote past and the more
recent experience, even if they seem so distant to be incomparable. We are
convinced of the possibility and the need for comparison over time, which
is our basic task as historians of the economy. The problem of falling from
imperial power to economic backwardness and the quest for moderniza-
tion from the late eighteenth century to the early twenty-first is fascinating
and a permanent issue for reflection for the Spanish society and for other
societies. We hope that the interpretations we present, which we believe
are widely shared, form the basis of educated opinion. Moreover, we aspire
that certain interpretations that we think are not well founded, will be
5 Leandro Prados de la Escosura, Spanish economic growth, 1850–2015, Palgrave Macmillan,
Palgrave Studies in Economic History, 2017.
