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Different sources on American precious metal production exist. While they agree about the amount of American precious metal production for the 16th and 18th centuries, they disagree for the 17th century. Sources that account for unregistered precious metal pro-duction show substantially higher numbers than sources that focus only on officially reg-istered production (Barrett, 1990). For our calculations, we use the official production data from TePaske (2010), which is the most comprehensive yet compiled. Figure A.1 shows this data and compares it to the production data by Humboldt (1811), who takes unregistered production into account. There is a substantial deviation between these two

8In earlier editions of Hume’s work the respective numbers were 7 million and 5 years.

Figure A.1: American precious metal production

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Tonnes of silver equivalent

1492 1550 1600 1650 1700 1750 1810

Year

TePaske (registered only) Humboldt TePaske + unregistered

series from the mid 17th century to the early 18th century.

Given that some of the sources that Humboldt used to construct his production series are unknown today, it is worth considering a second piece of evidence about the quantity of unregistered precious metal production: the amount of American precious metals that was arriving in Europe. This data was regularly published in contemporary Dutch gazettes that have been unearthed by Morineau (1985). In the 17th century, the European arrival data at times exceeds the official American production data, suggesting a considerable amount of unregistered production took place in America. Morineau’s arrival data and Humboldt’s production data reinforce each other in this regard (Barrett, 1990). We therefore adjust the official production data from TePaske for unregistered production.

To account for unregistered precious metal production we add 16.8% to the production series by TePaske – the adjustment factor calculated by Humboldt (1811). From the mid-17th century to the early 18th century the share of unregistered production was higher, reaching up to 50% (TePaske, 2010, pp.311ff.). We thus use a 50% adjustment factor for the period 1640-1720.⁹ From 1720, up to the late 18th century we switch back to

9During this period, the reduced supply of mercury to Mexican amalgamators facilitated an increase in illicit production. More refining was done using smelting, which made it easier to hide the exact amount of silver production from the fiscal authority. Brading and Cross (1972) note that due to the shortage of mercury just under half of Zacatecas’s silver was produced using smelting in the years 1685-1705. At Sombrerete, none of the silver was produced using amalgamation. In Peru, although the official production data shows a decline starting in the 1640s, mercury consumption was stable. Thus, Brading and Cross (1972) argue that actual Peruvian production did not peak until 1680. At the most fertile Peruvian mines in Potosi, production was taxed at more than twice the rate levied on other mines.

Consequently, the incentive to conceal silver production was higher. The illicit production taking place at Zacatecas, Sombrerete, and Potosi, was substantial relative to the total silver production in America.

Together these sites accounted for more than 40% of total official American silver production. The higher

Figure A.2: American precious metal arrivals in Europe

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Tonnes of silver equivalent

1492 1550 1600 1650 1700 1750 1810

Year

Inflows (incl. unregistered) Morineau's arrivals Inflows (registered only)

16.8%. Finally, by the late 18th century less and less production escaped registration by the Spanish Empire’s reformed bureaucracy. Therefore, from 1780 onwards we set our adjustment factor to 0%. The so-adjusted TePaske series is depicted by the solid black in Figure A.1. It closes much of the 17th century gap between the official production data, and Humboldt’s estimate.

The European inflows we calculate based on the American production data should align with the arrival data from Morineau (1985). To calculate European arrivals from American production data we subtract Pacific flows, American retention, and transporta-tion losses. Figure A.2 displays the resulting inflow series and compares it to Morineau’s arrival data. The solid black line depicts our European inflow series, and the gray mark-ers depict Morineau’s arrivals. In addition, the dashed gray line depicts European inflows when calculated on the basis of officially registered production only. The figure shows that accounting for unregistered precious metal production is important for bridging the gap between Morineau’s arrival series and European inflows as calculated from American production. While the discrepancy between these two series can still be substantial (esp.

from 1650 to 1700), this exercise shows that it is possible to substantially narrow down the range of plausible production and inflow values through the cross-validation of different data sources.

Moving from production data to inflow data, Figure A.3 compares officially registered precious metal inflows with inflows as reported by the Dutch gazettes (Morineau, 1985). In

unregistered silver production for the second half of the 17th century also squares well with an increase in unregistered silver shipments to Spain during this period (Mangas, 1989, p.316). Both were symptoms of a general weakening of imperial fiscal control (TePaske, 2010, pp.311).

Figure A.3: Official Spanish inflows versus gazette reports (decade averages)

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Tonnes of silver equivalent

1492 1550 1600 1650 1700 1750 1810

Year

Morineau's Spanish arrivals Hamilton Garcia Fuentes Garcia-Baquero

Notes: Black lines: officially registered inflows. Gray diamonds: Spanish American inflows reported in Dutch gazettes.

contrast to the production data, these series include Spanish inflows from Spanish Amer-ica only; Portuguese gold inflows from AmerAmer-ica are not contained. Officially registered Spanish inflows come from Hamilton (1934), Fuentes (1980), and García-Baquero (1996), who rely on the official documentation from the Casa de Contratación and individual ship registers.

As is the case with the production data, official inflows fall short of Morineau’s unoffi-cial arrival data from the middle of the 17th century onwards, up to the early 18th century.

Before that, the official and unofficial data sources are in agreement. After the early 18th century, the official and unofficial data sources converge again (see García-Baquero, 1996, for a detailed comparison).

The shortfall of official inflows vis-á-vis unofficial inflows after 1640 is not solely due to the concomitant increase in unregistered production documented earlier. In addition, it reflects an increase in unregistered transportation, i.e. smuggling across the Atlantic (Mangas, 1989, p.316), and changes in accounting methods for precious metal arrivals (Hamilton, 1934; TePaske, 2010, p.306) that accompanied the shift of colonial trade from Seville to Cádiz.¹⁰ Thus, while official inflow and production data both suffer from un-derreporting in the 17th century, the degree of unun-derreporting appears more manageable in the production data. As a consequence, the official production data can constitute a more reliable basis for estimating American precious metal remittances to Spain than the

10Fuentes (1980), one of the sources for official inflow data, concludes that the official figures for the second half of the 17th century grossly understate actual arrivals.

official Spanish inflow data.