THE COLONIAL ECONOMY 85
CORTÉS AS A BUSINESSMAN
The business career of Hernando Cortés illustrates
the large variety and scale of the economic activi-
ties of some encomenderos. By 1528, Cortés was al-
ready worth 500,000 gold pesos. Part of this wealth
represented his share of the loot taken in Tenochti-
tlán and other places during and immediately after
the Conquest. But his chief source of income was
his encomienda holdings. To himself he assigned
the richest tribute areas in the former Aztec Empire.
At the time of his death in 1547, although many of
his encomiendas had been drastically reduced and
tribute assessments lowered, he was still receiving
30,000 gold pesos annually from this source. He re-
ceived large quantities of gold dust, textiles, maize,
poultry, and other products from encomienda
towns. The pueblo of Cuer navaca (near Mexico
City) alone gave as part of its annual tribute cloth
worth 5,000 gold pesos. Cortés’s agents sold the
tribute cloth and other products to traders, who re-
tailed them in Mexico City and other Spanish towns.
Cortés had his own extensive real estate holdings
in Mexico City. On or near the central square, he
erected shops, some of which he used for his own
trading interests and some that he rented out.
Cortés was an empire builder in the economic
as well as the political sense of the word. He in-
vested the capital he acquired from encomienda
tribute and labor in many enterprises. Mining at-
tracted his special attention. In the Oaxaca and
Michoacán districts, he had gangs of indigenous
slaves, more than a thousand in each, panning
gold; many of these slaves died from hard labor
and inadequate food. In 1529 these mining areas
brought him 12,000 pesos in gold annually. In ad-
dition to his own mining properties, Cortés held
others, such as silver mines in the Taxco area of
Mexico, in partnerships. In such cases, his invest-
ment usually consisted of goods, livestock, enco-
mienda, or black slave labor.
After encomienda tribute, agriculture and
stock raising were Cortés’s largest sources of in-
come. He had large landholdings in various parts
of Mexico, some acquired by royal grant, others
usurped from native peoples. He employed enco-
mienda labor to grow maize on his land. His fi elds in
the vicinity of Oaxaca alone produced ten to fi fteen
thousand bushels a year. Part of this grain he sold
in the Spanish towns and at the mines; part went
to feed his gangs of slaves at the gold washings.
Cortés also raised great numbers of cattle and hogs,
which were butchered in his own slaughterhouses.
Near Tehuantepec he had herds of more than ten
thousand wild cattle, which supplied hides and tal-
low for export to Panama and Peru.
The restless Cortés also pioneered in the devel-
opment of the Mexican sugar industry. By 1547,
his plantations were producing more than three
hundred thousand pounds of sugar annually, most
of which was sold to agents of European merchants
for export. If he was not the fi rst to experiment with
silk raising in New Spain, as he claimed, he certainly
went into the business on a large scale, planting
thousands of mulberry trees with native labor paid
in cash or cacao beans. In this venture, however, he
suffered heavy losses. Nonetheless, the variety and
extent of Cortés’s business interests suggest how
misleading is the familiar portrait of the conquista-
dor as a purely feudal type devoted only to war and
plunder, disdainful of all trade and industry.THE GROWTH OF THE HACIENDAS
Among the fi rst generation of colonists, large-scale
enterprises such as those of Cortés were rare. The
typical encomendero was content to occupy a
relatively small land grant and draw tribute from
natives, who continued to live and work in large
numbers on their ancestral lands. The major shift
from reliance on encomienda tribute to the develop-
ment of Spanish commercial agriculture and stock
raising came after 1550 in response to the massive
indigenous population decline and the crown’s re-
strictive legislation, which combined to deprive the
encomienda of much of its economic value. Acute
food shortages in the Spanish towns created new
economic opportunities for Spanish farmers and
ranchers. Simultaneously, this population decline
left vacant large expanses of land, which Spanish
colonists hastened to occupy for wheat raising or,
more commonly, for sheep or cattle ranges.
By the end of the sixteenth century, the Spanish-
owned hacienda was responsible for the bulk of