General and Special Providence in Contemporary Accounts of Spanish New World Inflation

Abstract

While recent scholarship has explored the theological foundations of modern economic ideas, it has focused almost exclusively on general or ordinary providence (God’s action through secondary, natural causes) at the expense of special or extraordinary providence (God’s action in the world through direct primary causation, often outside or beyond the natural order). This paper challenges this by arguing that the transformation of providence into modern economic laws was a contested negotiation over the social and political implications of different modes of divine action. Through a comparative analysis of Bartolomé de Las Casas and Martín de Azpilcueta, I examine their conflicting interpretations of the sixteenth-century price revolution in Spain. While both identified the influx of American precious metals as the immediate cause of high prices in Spain, Las Casas viewed it as an instance of special providence – a prophetic punishment for the great sins that had accompanied the conquest of the New World. Conversely, Azpilcueta framed it as an instance of general providence, rooted in natural law principles of scarcity and abundance. I argue that Azpilcueta’s framework ultimately came to dominate the subsequent development of economic ideas due to its capacity for social and political stabilization, reconciling imperial ambition with Counter-Reformation piety and legitimizing mercantile activity ‘in good conscience.’