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In spite of these social divisions, it was common for there to be marriages between members of different social groups. This mixing (mestizaje in Spanish) led to the appearance of three new social groups: the mestizos (sons of natives and whites), mulatos (sons of "blacks" and "whites") and zambos (sons of "blacks" and natives).

These groups made up of people with African or American descent were known as castes (castas in Spanish).

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had to pay them tributes. They were legally inferior to the "whites" and they were considered equal to underaged people, which is why they had to be protected by the

"whites". In practice, this meant that natives were to be subdued by the Spanish.

The lowest social stratum was made up by the africans, who had been introduced to America as slaves and were called blacks. Africans lacked rights and were considered property of their slaves; therefore, they were bought and sold as goods.

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The criollos shared many of the economic activities carried out by Spaniards, though they occupied positions of lesser hierarchy or importance. For example, they sometimes held positions in the local government, such as the cabildos. As time went by, conflicts started to stem between white Spaniards and criollos.

However, not all of the criollos were allowed to occupy positions in the government.

In order to do so, you had to be a vecino, which implied owning a property. Some criollos, however, didn't have any properties, money or prestige and carried out manual labors, such as in farming, construction, or transport

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Among the "whites", there was an important difference between the "Spaniards" (those born in Spain) and the criollos or creoles (descendants of Spanish but born in America). The Spaniards concentrated greater privileges as they controlled the main economic resources and occupied the most important positions in the government. They were mostly owners of encomiendas, landowners, businessmen, merchants, miners or professionals (such as doctors and lawyers). Others were important military or government officials or held important eclesiastical (Church) positions&

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The population of European origins made up the highest stratum of colonial society.

The origins of the "white" elite can be traced back to the start of the conquest. It was made up by conquistadors and those descendents who had purchased nobiliary titles, obtained the best lands, and/or been benefited with encomiendas (groups of natives legally bound to work for them). However, as the colonial economy started flourishing, a group of white men started accumulating wealth thanks to mining and commerce and became part of the social elite.

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In the American colonies, the Spaniards established a hierarchical society based on ethnic criteria. Differences between social groups was mainly based on people's skin color, though also on other factors such as wealth and education. Therefore, a person's social status depended on their ethnic origin as well as their birthplace.

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In order to encourage the populating of America, the Spanish Crown initially offered conquistadors encomiendas. The encomienda was a labor system by which groups of natives were entrusted to Spanish proprietors. The proprietor was supposed to protect them and care for them, both physically and spiritually. This meant that they had to provide them with food and clothing and to evangelize them (convert them to Catholicism). In exchange, the Spanish proprietors, or encomenderos, were granted the legal right to extract forced labor and tributes from the natives.

Even though the encomenderos were supposed to protect the group of natives working for them, they often abused and enslaved them. This resulted in the reduction of the native population, as many died from diseases and maltreatment.

Therefore, towards the end of the 17th century, the encomienda was eventually replaced by low-paid labor as well as slavery.

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Spain sought to concentrate the riches from America by prohibiting other European nations from trading with their colonies. Therefore, in the 16 century, they created a monopolistic commercial system, which meant that the American colonies were forbidden from trading with each other or with other countries apart from Spain.

This policy, seemingly successful at first, fell short later because Spain failed to provide necessary manufactured goods for its colonies. As a result, foreign competitors appeared, and smuggling (contrabando) or illegal trade grew.

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Mining was the base of the colonial economy throughout the 16th and 17th centuries. It underwent different phases: the first one is known as the predatory phase. During this period, the conquistadors obtained precious metals through the looting or pillaging of temples and treasures or by trading with the natives. However, this evolved into the extraction phase, where the Spanish discovered and exploited rich mineral deposits. The two most Thportant mining centers were the ones in Zacatecas, Mexico, and Potosi, Bolivia. To the left, you can see the first image of the Cerro Rico of Potosi, dating from 1553.

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Mining, agriculture and manufacturing activities

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Mining, agriculture and manufacturing activities

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Mining also triggered agricultural and manufacturing activities, as it was necessary to supply the mining and port cities with food and manufacures. Most of the goods produced in America were used for internal consumption. However, part of the gold and silver produced in the colonies were used by the Spanish Crown to pay off debts that they had contracted during the European Wars of the 16th century. Precious metals were also used to bring luxury goods from Europe to America.

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Finally, the Spanish created cabildos, institutions in charge of the administration of the cities or towns in America. Cabildos regulated commerce as well as judicial or administrative matters. They were formed by vecinos or "neighbors", who were male heads of the family who owned properties and who served in the city's militia.

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As regards the judiciary branch, the most important judiciary court in both Spain and America was known as the Real Audiencia. In the 16th and 17th centuries, the Crown established audiencias in the twelve main cities of America Virreinatos de Nueva España. They were in charge of applying the Indies Laws (the laws sanctioned by the Council of the Indies).

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In 1524, the Spanish Crown created the Council of the Indies (Consejo de Indias) as a lawmaking body for the colonies. During the three centuries of its existence, this council enacted a massive amount of legislation. They were also in charge of advising the king and supervising the American government officials.

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Shortly before the death of Queen ISabella I in 1504, the Spanish sovereigns created the Casa de Contratación or House of Trade to regulate commerce between Spain and the so-called "New World". This institution was also in charge of inspecting ships and creating navigation maps

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The Spanish kings wanted to centralize the administration and the control of its new countries. With this aim in mind, they created new institutions.