The economy of New Mexico during the first century of its Spanish occupation centered around trade between the settlers, the Indians, and the Spanish in New Spain. New supplies were only delivered to Santa Fe from New Spain every three years. Shortages of supplies occurred and trade systems became a necessary tool.

Spanish Period Corn obtained by the encomienda system provided the settlement with needed food supplies and limited the food supplies of the Pueblos. Blankets obtained by these demands were also used as trade goods. Labor supplied by the repartimiento demands aided the Spanish economy because labor costs were minimal or not at all. Hispanic residents were required to support the local government and the crown by paying various tributes or taxes.

Sheep and cattle were traded by the Spanish. Indians traded hides, turkeys, jerky, tallow, pelts, and captives for beads, iron implements, and other merchandise.

Mining was not too important to the economic growth of New Mexico during the first century of its Spanish colonization. Salt taken from deposits in New Mexico was used for trading.

New Mexico was in the middle of a drought by 1650. From 1665 to 1668 no crops were harvested by the Indians or the Spanish. There were no crops that could be used by the Spanish as trade goods and the economy suffered. This drought had a devastating effect on the economy of the region. The economy based on trade was reestablished following the Spanish reconquest of New Mexico.