Economic Change: The Holy Roman Empire
During the Early Modern Era, the Holy Roman Empire was one of the most decentralized political entities in recorded history. Its countless internal duchies, counties, provinces, bishoprics and other subdivisions all had their own mostly sovereign rulers, who could go to war with each other, form alliances, and perhaps most significantly, set their own economic policy. This meant that the economy of the Empire was an unpredictable, uncontrollable system, in which leading economic theorists were often completely disconnected from the realities of peasant life, or even from the state of economic policy one town over. For this and several other reasons, the Empire never enjoyed the early leads in commercialization or industrialization that powers like the Netherlands and England were able to seize, but at the same time the German lands were far from economically backwards. Major events in the early modern economic history of the Holy Roman Empire include the Price Revolution, in which the influx of New World silver into Spain - ruled by the same Habsburg dynasty which also held the Imperial throne - led to a sharp rise in inflation. The combination of this and general Habsburg overextension led to serious issues in Imperial finance. This was followed up by the brutal Thirty Years’ War, one of the deadliest conflicts in European history, in which the German heartlands were devastated and the people left impoverished almost everywhere. In spite of these calamitous events, the economy of the Empire would steadily recover, and a succession of 18th-century emperors and other rulers would implement a series of economic reforms which strengthened state bureaucracy in most of the major domains of the Empire, particularly Austria and Prussia. In contrast with the laissez-faire proto-capitalism beginning to take hold in France and Britain, Austrian and Prussian economic policy was more focused on building effective civil bureaucracies, although the broader Empire would only experience the effects of these reforms sporadically as decentralization was cemented by the failure of Austria to enforce religious unity. State-central economic policy would go on to play a large part in the final series of wars leading to German unification, as the Prussian “army with a state” model proved to be extremely effective.