Figure 2. Three South American Viceroyalties, ca. 1800
Source: Based on information from A. Curtis Wilgus, Historical Atlas of Latin America, New York, 1967, 112.

The Habsburg dynasty's rule over Spain ended in 1700. The Habsburgs' successors, the French Bourbon monarchs, reigned for the rest of the colonial period. In the second half of the eighteenth century, they tried to restructure the empire to improve its productivity and defense. The main period of Bourbon reforms in Chile lasted from the coronation of Charles III (1759-88) in Spain to the end of Governor Ambrosio O'Higgins y Ballenary's tenure in Chile (1788-96).

The Bourbon rulers gave the audiencia of Chile (Santiago) greater independence from the Viceroyalty of Peru (see fig. 2). One of the most successful governors of the Bourbon era was the Irish-born O'Higgins, whose son Bernardo would lead the Chilean independence movement. Ambrosio O'Higgins promoted greater self-sufficiency of both economic production and public administration, and he enlarged and strengthened the military. In 1791 he also outlawed encomiendas and forced labor.

The Bourbons allowed Chile to trade more freely with other colonies, as well as with independent states. Exchange increased with Argentina after it became the Viceroyalty of the Río de la Plata in 1776. Ships from the United States and Europe were engaging in direct commerce with Chile by the end of the eighteenth century. However, the total volume of Chilean trade remained small because the colony produced few items of high unit value to outsiders.

Freer trade brought with it greater knowledge of politics abroad, especially the spread of liberalism in Europe and the creation of the United States. Although a few members of the Chilean elite flirted with ideals of the Enlightenment, most of them held fast to the traditional ideology of the Spanish crown and its partner, the Roman Catholic Church. Notions of democracy and independence, let alone Protestantism, never reached the vast majority of mestizos and native Americans, who remained illiterate and subordinate.

Data as of March 1994