Abstract
This chapter re-reads the neoliberal reforms of the military dictatorship from a political economy perspective. It argues that the dictatorship sent the bases for the passive integration of Chile into the world economy that would consolidate during the nineties. This integration was the outcome of the consensus between the government and the new export capitalists. The economic expansion around exports was not only an outcome of market liberalization but also the result of a deep state involvement in promoting new sectors around natural resources since the sixties.
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Notes
- 1.
Indeed, this idea was clearly expressed in the first economic program the dictatorship published, a document called “The Brick.” As the text indicates, “the excessive polarization of our society is linked with this tendency, because the action of the state has been penetrating in all the areas of society” (CEP 1992: 30, my translation).
- 2.
- 3.
These economic conglomerates and the Chicago Boys had strong connections. In fact, many of the executives of these conglomerates were members of this technocratic liberal team (see Silva 1996).
- 4.
See Chapter 2, Sect. 1 for a discussion of the bases of neoliberal thought on development .
- 5.
This approach maintained that the main cause of inflation was money creation by the government and its series of interventionist measures (price controls, tariffs, etc.). Thus, inflation could only by reduced by limiting state involvement in the economy. Of course, this approach assumed a closed economy, so the exchange rate was not included as a potential anti-inflationary measure (see Edwards and Cox 1987).
- 6.
Established in 1969, the Andean Pact was a regional economic agreement that included Bolivia , Colombia , Chile , and Ecuador (Venezuela became a member in 1973). Its main goal was to build a common market and establish a series of developmentalist measures in different areas. For example, in the beginning, the Pact included a common external tariff with levels around 100% for almost 70% of imports, in order to protect national industries. The Pact also established a common set of rules for foreign investments (known as Decision 24 ), which required foreign firms investing in the region in the medium term (15–20 years), to share ownership with the State, in order to obtain a certain degree of control over technology, investments and profits (see Direcon 2009).
- 7.
- 8.
Even though its objective is to create new sectors in general, most of its investment until today has been in exports of natural resources (see Agosin et al. 2010).
- 9.
Campero (1984: 245).
- 10.
See Table 1 in Chapter 5 for an explanation of these business associations .
- 11.
The fix exchange rate measure was even criticized by Milton Friedman, which considered this a state intervention that caused Chile’s crisis of 1982 (Friedman and Friedman 1988).
- 12.
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Ahumada, J.M. (2019). The Chilean Military Dictatorship and the Origins of Peripheral Growth. In: The Political Economy of Peripheral Growth. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-10743-7_4
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