NEOLIBERALISM AND THE WASHINGTON CONSENSUS: THE CASE OF CHILE
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Transcript of NEOLIBERALISM AND THE WASHINGTON CONSENSUS: THE CASE OF CHILE
NEOLIBERALISM AND THE WASHINGTON CONSENSUS:
THE CASE OF CHILE
12. STRATEGIES FOR ECONOMIC DEVELOPMENT
• The Liberal Eera (1880s-1920s)
• Import-Substitution Industrialization (1930s-1970s)
• The Socialist Alternative (1950s-1980s)
• Neoliberalism (1980s-present)– The “new Left”– ALBA
WASHINGTON CONSENSUS
• Reducing the role of the state– Less regulation– Privatization
• Liberalizing trade– Reduce tariffs, quotas– Expand exports
• Promoting the private sector– Foreign and local production– Stimulate market competition
CHILE: OVERVIEW• Natural Resource: Minerals
– Nitrates
– Copper
– Sparse migration
• Export-Import Growth– Pacific Coast connections
– Copper as key
– Political democracy (of sorts)
• Democracy and Military Rule– Party politics (1940s-70s)
– Socialism via democracy? Salvador Allende (1970-73)
– The Pinochet regime (1973-1989)
• Neoliberal Politics and Policy– Democracy (1990-present)
– Economic uncertainty + reliance on exports (again)
CHILE: BASIC STATS
• Population 16.9 million
• GNP/capita 8,350 USD
• Poverty rate 13.7 %
DEMOCRATIC PRESIDENTS
Center-Left alliance: Concertación
• Patricio Aylwin (1990-94)
• Eduardo Frei (1994-2000)
• Ricardo Lagos (2000-06)
• Michelle Bachelet (2006-10)
Right:
• Sebastián Piñera (2010- )
THE WASHINGTON CONSENSUS
• Reducing the role of the state:– Less regulation– Less public ownership
• Liberalizing trade:– Reducing tariffs and quotas = less protection– Seeking commercial partners
• Promoting private enterprise:– Privatization– Foreign investment
POLICIES IN CHILE
• Trade liberalization– Unilateral +– FTAs– Diversification of destinations
• Privatization
• Stability (low inflation)
• Foreign investment
• Poverty and inequality
EXPORTS
• Products: copper, fruits and nuts, fish and seafood, wood (and wine)
• Partners (2009):– China 16.5 %
– USA 11.3
– Japan 9.1
– South Korea 6.5
– Brazil 4.6
– Mexico 4.1
INEQUALITY
• Mexico .461
• Argentina .513
• Chile .549
• Brazil .570
• USA .408
Thus is born a “poster child”…