The period between the 16th and the beginning of the 19th centuries, when Istria was governed by
the Venetians, was marked by stagnation and economic decline. One of the reasons for this was the
new, central role of the Trieste, and partly also the Rijeka, harbors. The old, traditional merchant
routes, once leading from the continental hinterland to Venetian Istria, were thus rerouted to both
Hapsburg harbors. Aside from unfavorable demographic factors this sorry state of the Istrian
economy was also the result of the Venetian tax policy. Before being shipped overseas, every
product had to be sent to Venice for tax purposes; furthermore, from the middle of the 17th century
the insatiable treasury steadily increased taxes on most products which brought in any kind of
profit; the produce for home consumption were not exempt either. This policy gave rise to contraband
activities which could not be stopped by any, however intimidating, punishments.