Antagonized Indian bands used guerrilla tactics to slay the strangers and willingly burnt their own crops to deny them food. Nicuesa set the tone for future expeditions by foreshortening his own cultural lessons with the musket ball. Things seemed more promising when an expedition under Gil Gonzalez Davila set off from Panama in 1522 to settle the region. It was Davila's expedition, given quantities of gold, that nicknamed the land Costa Rica, the "Rich Coast."
Davila's Catholic priests also supposedly managed to convert many Indians to Christianity. But once again, sickness and starvation were the price: the expedition reportedly lost more than 1,000 men.Later colonizing expeditions on the Caribbean similarly failed miserably; the coastal settlements dissolved amidst internal acrimony, the taunts of Indians, and the debilitating impact of pirate raids. Two years later, Francisco Fernandez de Cordova founded the first Spanish settlement on the Pacific, at Bruselas, near present-day Puntarenas. It lasted less than two years.
For the next four decades Costa Rica was virtually left alone. The conquest of Peru by Pizarro in 1532 and the first of the great silver strikes in Mexico in the 1540s turned eyes away from southern Central America. Guatemala became the administrative center for the Spanish main in 1543, when the captaincy-general of Guatemala, answerable to the viceroy of New Spain (Mexico), was created with jurisdiction from the Isthmus of Tehuantepec to the empty lands of Costa Rica.
By the 1560s several Spanish cities had consolidated their position farther north and, prompted by Philip II of Spain, the representatives in Guatemala thought it time to settle Costa Rica and Christianize the natives. By then it was too late for the latter. Barbaric treatment and European epidemics--opthalmia, smallpox, and tuberculosis--had already reaped the Indians like a scythe, and had so antagonized the survivors that they took to the forests and eventually found refuge amid the remote valleys of the Talamanca Mountains. Only in the Nicoya Peninsula did there remain any significant Indian population, the Chorotegas, who soon found themselves chattel on Spanish land.
In 1562, Juan V´squez de Coronado the true conquistador of Costa Rica arrived as governor. He treated the surviving Indians more humanely and moved the existing Spanish settlers into the Cartago Valley, where the temperate climate and rich volcanic soils offered the promise of crop cultivation. Cartago was established as the national capital in 1563. The economic and social development of the Spanish provinces was traditionally the work of the soldiers, who were granted encomiendas, land holdings which allowed for rights to the use of indigenous serfs.
In the highlands, land was readily available, but there was no Indian labor to work it. Without native slave labor or the resources to import slaves, the colonists were forced to work the land themselves (even Coronado had to work his own plot of land to survive). Without gold or export crops, trade with other colonies was infrequent at best. Money in fact became so scarce that the settlers eventually reverted to the Indian method of using cacao beans as currency. After the initial impetus given by the discovery, Costa Rica lapsed into being a lowly Cinderella of the Spanish empire.
Thus, the early economy evolved slowly under conditions that didn't favor the development of the large colonial-style hacienda and feudal system of other Spanish enclaves. The settlers had to make do with clearing and tilling primitive plots for basic subsistence. A full century after its founding, Cartago could boast little more than a few score adobe houses and a single church, which all perished when Volcan Irazu erupted in 1723.
Gradually, however, prompted by an ecclesiastical edict that ordered the populace to resettle near churches, towns took shape around churches. Heredia (Cubujuquie) was founded in 1717, San Jose (Villaneuva de la Boca del Monte) in 1737, and Alajuela (Villa Hermosa) in 1782. Later, exports of wheat and tobacco placed the colonial economy on a sounder economic basis and encouraged the intensive settlement that characterizes the Meseta Central today.
Intermixing with the native population was not a common practice. In other colonies, Spaniard married native and a distinct class system arose, but mixed-bloods and ladinos (mestizos) represent a much smaller element in Costa Rica than they do elsewhere in the isthmus. All this had a leveling effect on colonial society. As the population grew, so did the number of poor families who had never benefited from the labor of encomienda Indians or suffered the despotic arrogance of criollo landowners. Costa Rica, in the traditional view, became a "rural democracy," with no oppressed mestizo class resentful of the maltreatment and scorn of the Creoles. Removed from the mainstream of Spanish culture, the Costa Ricans became very individualistic and egalitarian.
Not all areas of the country, however, fit the model of rural democracy. Nicoya and Guanacaste on the Pacific side offered an easy overland route from Nicaragua to Panama and were administered quite separately in colonial times from the rest of present-day Costa Rica. They fell within the Nicaraguan sphere of influence, and large cattle ranches or haciendas arose. Revisions to the encomienda laws in 1542, however, limited the amount of time that Indians were obliged to provide their labor; Indians were also rounded up and forcibly concentrated into settlements distant from the haciendas. The large estate owners thus began to import African slaves, who became an important part of the labor force on the cattle ranches that were established in the Pacific northwest. The cattle-ranching economy and the more traditional class-based society that arose persist today.
Some three centuries of English associations and of neglect by the Spanish authorities have also created a very different cultural milieu all along the Caribbean coast of Central America. On the Caribbean of Costa Rica, cacao plantations the most profitable activity of the colonial period became well established. Eventually large-scale cacao production gave way to small-scale sharecropping, and then to tobacco as the cacao industry went into decline. Spain closed the Costa Rican ports in 1665 in response to piracy, thereby cutting off seaborne sources of legal trade. Such artificial difficulties to economic development compounded those created by nature. Smuggling flourished, however, for the largely unincorporated Caribbean coast provided a safe haven to buccaneers and smugglers, whose strongholds became 18th-century shipping points for logwood and mahogany. The illicit trade helped weaken central authority. The illusion of Central American colonial unity was also weakened in the waning stages of the Spanish empire as interest in, and the ability to maintain, the rigid administrative structure declined.
Independence of Central America from Spain on 15 September 1821 came on the coattails of Mexico's declaration earlier in the same year. Independence had little immediate effect, however, for Costa Rica had required only minimal government during the colonial era and had long gone its own way. In fact, the country was so out of touch that the news that independence had been granted reached Costa Rica a full month after the event. A hastily convened provincial council voted for accession to Mexico; in 1823, the other Central American nations proclaimed the United Provinces of Central America, with their capital in Guatemala City.
After the declaration, effective power lay in the hands of the separate towns of the isthmus, and it took several years for a stable pattern of political alignment to emerge. The four leading cities of Costa Rica felt as independent as had the city-states of ancient Greece, and the conservative and aristocratic leaders of Cartago and Heredia soon found themselves at odds with the more progressive republican leaders of San Jose and Alajuela. The local quarrels quickly developed into civic unrest and, in 1823, to civil war. After a brief battle in the Ochomogo Hills, the republican forces of San Jose were victorious. They rejected Mexico, and Costa Rica joined the federation with full autonomy for its own affairs. Guanacaste voted to secede from Nicaragua and join Costa Rica the following year.
From this moment on, liberalism in Costa Rica had the upper hand. Elsewhere in Central America, conservative groups tied to the Church and the erstwhile colonial bureaucracy spent generations at war with anticlerical and laissez-faire liberals, and a cycle of civil wars came to dominate the region. By contrast, in Costa Rica colonial institutions had been relatively weak and early modernization of the economy propelled the nation out of poverty and lay the foundations of democracy far earlier than elsewhere in the isthmus. While other countries turned to repression to deal with social tensions, Costa Rica turned toward reform. Military plots and coups weren't unknown they played a large part in determining who came to rule throughout the next century but the generals usually were puppets used as tools to install favored individuals (usually surprisingly progressive civilian allies) representing the interests of particular cliques.
More info about Presidential's House: Spanish information about Government of Costa Rica