Portugal in the sixteenth century was in the first place, to use João Lucio de Azevedo's term, an ‘agrarian monarchy’. Land, its major asset, was largely held in the form of the great manorial estate. The king himself was a landowner – unus inter pares. He could retract land grants made in the past. Moreover, lands bestowed by him could devolve only on the eldest legitimate son. These measures maintained the cohesion of the great estates and ensured the obedience to the king of their titular owners.

At the same time Portugal has also been called a ‘maritime monarchy’. Endowed with a relatively long oceanic seaboard, Portugal had in the late Middle Ages made use of the sea for both coastal trading and long-distance voyages. Fishing was a significant resource and extended beyond the coastal waters as far as Newfoundland. The salt marshes of Aveiro, Lisbon and Setubal supplied not only Portuguese needs but also those of ships from the Mediterranean sailing to northern Europe and the Baltic. Thus was Portugal able to maintain a larger population than if she had merely depended on her agriculture and the export of corn. After the Great Discoveries in the fifteenth century the Atlantic island colonies – Madeira and the Azores – and the trading stations of Morocco, the Cape Verde islands and the Guinea coast brought products such as timber, sugar and wine to Portugal for re-export to Europe. Then gold from Guinea, spices from India and first brazilwood and, later, sugar from Brazil transformed the Portuguese economy.