The classically mercantilist phase (1492–1700) of Spanish colonialism saw the uprooting of indigenous societies; the physical settlement of the region by Europeans; and the installation of new political, economic, and sociocultural institutions. These processes occurred in each of the territories that would become the modern countries of Spanish America. Yet the extent to which the Spanish reorganized indigenous people, developed settlements, and installed institutions varied across these territories. Such variations, in turn, affected the degree to which entrenched mercantilist actors came into being, with large subsequent implications for national development.

It is useful, I suggest, to categorize the territories corresponding to the modern countries of Spanish America according to three types of mercantilist colonies: centers, peripheries, and semiperipheries (see Table 3.1). The mercantilist colonial centers of Mexico, Peru, and Bolivia were the principal areas of Spanish settlement and activity, featuring the most important colonial administrations, the most intensive and far-reaching systems of labor exploitation, and the greatest expressions of Spanish sociocultural life (including Catholic religion). Each colonial center was represented by one city – Mexico City, Lima, and Potosí, respectively – that especially concentrated Spanish people and institutions and that served as a heartland of the overall colonial project, even though huge parts of Mexico, Peru, and Bolivia were not colonized at all.