Simultaneously, the Dutch Republic, a federation of seven provinces, emerged as Europe's leading economy and a major player in the seventeenth-century power struggles, a position built on the economic growth and fiscal muscle of the province of Holland. Working within the narrow financial margins set by cities in Flanders and Brabant, which refused to relinquish their control over local taxation, this regime had to contend both with serious economic decline and repeated foreign invasions. The Spanish and subsequently Austrian Netherlands continued to be ruled by foreign monarchs who relied on deputies and a small Brussels bureaucracy to govern the country. During the 1560s, the Dutch Revolt sent the northern and southern part of the Netherlands on very different paths of economic and political development. The political unification of the Netherlands survived Charles' reign only briefly. By the mid-sixteenth century, he had brought almost the entire area of what is now known as the Benelux under Habsburg rule, and had achieved a considerable degree of administrative, legal, and fiscal harmonization in the three leading provinces of Flanders, Brabant, and Holland. After his death, this process stalled for several decades, before being pushed forward again by Charles V, who ruled the Netherlands from 1515 onward. During his long reign (1419–67), Philip made considerable headway in the legal and administrative centralization of his territories.
The area remained politically fragmented until the second quarter of the fifteenth century when Philip the Good, Duke of Burgundy, brought Flanders, Brabant, Hainaut, Namur, Limburg, Holland, Zeeland, and Friesland under his rule. Public financing challenges were at the center of financial innovation, and those challenges reflected the influences of trade and war on government fiscal affairs.ĭuring this period, commercial farming, trade, and manufacturing grew rapidly in the coastal provinces of Flanders, Brabant, Holland, and, to a lesser extent, also in Friesland and Zeeland. Jonker, in Handbook of Key Global Financial Markets, Institutions, and Infrastructure, 2013 Introductionįrom the late Middle Ages onward, the Low Countries played a central role in global conflicts and trade, and displayed remarkable economic dynamism.