Productivity and Growth in Perspective: Chile, 1833–2010

This paper presents a long-period growth accounting for Chile, an emerging economy, from the early nineteenth century through to 2010. The methodology, data, and sources used are thoroughly discussed, and the results are compared with a benchmark based on a sample of countries. Some of the findings are: Chile's average productivity growth over the whole period is explained mainly by capital deepening, but long period averages hide huge and variable differences when various time subdivisions are explored. Gross TFP growth increases throughout phases until 1973 when an international reduction sets in. The research also put the role of employment-population ratio into perspective.     

Regional Market Potential and the Number and Size of Firms: Observations and Evidence from Chile

Abstract

This paper investigates the relationship between market potential and the spatial variation in the number and the average size of firms. We adapt the canonical model of the New Economic Geography to demonstrate this relationship and to derive an empirical specification suitable for estimation through dynamic panel techniques. The model is tested against municipal data on the number of firms per adult in Chilean comunas for 2005–2010. Our results confirm that market potential along with place-specific fixed costs play an important role in determining the spatial variation in the number of firms per capita.     

Agricultural trade and poverty in Chile: a spatial analysis of product tradability

Many questions have arisen about the relationship between international agricultural trade and poverty in developing countries. This article explores these questions by analyzing local agricultural tradability indices, which measure the degree to which commodities produced in a particular region are traded internationally. Data are examined for Chile, a middle‐income country with a history of international agricultural trade over the last decades. Empirical results indicate that a higher agricultural tradability index is associated with lower poverty rates across Chilean comunas.     

Revolution from below in Panguipulli: Agrarian reform and political conflict under the Popular Unity in Chile

This article examines the political conflict in rural society during the Popular Unity Government (1970–73) by focusing on the mobilization of forestry workers in Panguipulli, a district in southern Chile. Adopting land invasions as their main strategy in the struggle for land and power, Panguipulli workers experienced a radical politicization by aligning themselves with the Peasant Revolutionary Movement, the “peasant front” of the Revolutionary Left Movement. Because of its relation with this emerging “new left,” rural mobilization was a significant expression of the “revolution from below”, which challenged the Popular Unity's “Chilean road to socialism.” Moreover, because rural mobilization also took place in other areas throughout Chile where the Revolutionary Left Movement was influential, it gave rise to a grassroots project for radicalizing the government's agrarian reform. As a result, the rural “revolution from below” strongly influenced the content and trajectory of political conflict under the Popular Unity Government.     

Land versus Territory: Evaluating Indigenous Land Policy for the Mapuche in Chile

What are the challenges associated with translating indigenous territorial demands into land policy? While most land policy prioritizes the economic utility of land, indigenous territorial demands call for governments to more broadly conceptualize the definition and utility of land. Since the 1990s, most Latin American countries have formally recognized a range of indigenous territorial rights and worked to translate these rights into practice. Drawing on the Chilean experience, this paper argues that these alternative conceptualizations of land and territory complicate the implementation of government efforts to recognize indigenous demands. Specifically, the insufficiently defined scope of the policy exacerbates tension between communities' territorial rights demands and the government's capacity to return land. This tension is gradually and bureaucratically resolved, hindering both the policy's ability to meaningfully respond to indigenous territorial demands and the government's objective of promoting rural development. Future discussions and research must consider how these competing conceptualizations of land affect indigenous and land policy.     

Understanding domestic savings: an empirical approach

ABSTRACT

There are two unusual and important features in the evolution of the savings rate in Chile. First, the economy increased the average savings rate by 11 percentage points in the period 1985–2013 compared to 1960–1984, mainly due to a large change in private savings rate (10 percentage points), and an additional 1 percentage point from the public sector. The second feature is related to the change in the composition of private savings. After several years of nearly no corporate savings, this component became an important part of total savings reaching an average of almost 10% of Gross National Disposable Income (GNDI) during the period 1986–2012. Our results show that the 1984 tax reform, the boost in the marginal productivity of capital and the deepening of the financial market were the main drivers that explain the dramatic increase in corporate savings. We also found that the reduction in personal income tax after the tax reform and the higher income per capita growth helped to explain the increase in household savings, while the structural balance rule helped to explain the increase in public savings.     

Women in Business in Late Nineteenth-Century Chile: Class,Marital Status,and Economic Autonomy

This article analyzes Chilean women’s entrepreneurial activity in the 1877–1908 period examining two official data sources representing different socioeconomic business niches – the national trademark registry, which represents the elite among business people, and the Santiago business license registry, which includes the non-elite. The analysis reveals an economy with women engaging increasingly in business in an expanding range of sectors. By the 1890s, women managed nearly a quarter of Santiago’s firms and 5 percent of elite firms nationally. Widows appeared overrepresented among elite businesses and underrepresented among those of the non-elite. These results suggest that institutions constraining entrepreneurship among married women were more strongly enforced among the elite than among other social classes. The evidence thus suggests that during late nineteenth century there was an increase in the economic autonomy exercised by unmarried women and widows of all socioeconomic strata, but also by married women among the non-elite.     

Beyond access: A relational and resource-based model of household Internet adoption in isolated communities

Isolated rural communities face specific challenges associated with their geographical context in the digital inclusion process. Thus, based on a relational and resource-based model as well as diffusion research, this study explored personal, positional factors, as well as material and social resources of household Internet connection in remote communities that received infrastructure access for the first time between 2010 and 2011 in Chile. A face-to-face representative survey conducted in 22 communities revealed that, among personal variables, age and innovative personality played a role in household Internet adoption. Material resources such as income and transport connectivity were also relevant. However, social resources were among the most significant predictors. That is, the presence of children in the household and larger social networks were associated with greater chances of Internet connection.     

Simulating land use changes under alternative policy scenarios for conservation of native forests in south-central Chile

In this study, we combined policy analysis with landscape change modeling to simulate outcomes of alternative forest conservation instruments proposed by opposing policy coalitions. In 1992, concern over rapid land conversion to timber plantations (Pinus radiata and Eucalyptus spp.) in Chile gave rise to a protracted policy process resulting in the 2008 Native Forest Law (NFL), which subsidizes reforestation and management with native forest. To date, however, NFL has had little impact on native forest conservation. To understand how the policy process that created the NFL shaped its outcomes, we employed the Dyna-CLUE modeling approach to simulate land use changes in south-central Chile from 1993 to 2007, based on 3 scenarios: (1) enactment of NFL in 1993 when the law was originally debated, and the different configurations of subsidies and regulations proposed in the NFL policy debate by (2) the industrial forestry coalition and (3) the forest conservation coalition. We observed no major difference in native forest loss between simulated outcomes of the industry-advocated policy and the actual NFL legislation. The conservation coalition’s policy scenario increased native forest area, primarily in shrub steppe areas, but also via conversion of pine plantations if incentive payments were large enough. However, NFL payments are inadequate to make native forest management a viable economic land use alternative to industrial pine plantations, which are also subsidized in Chile. Gains in native forest cover occurred mostly on lands under ancestral indigenous claims (unrelated to the discussion of the NFL). We conclude that the NFL, even if enacted in 1993, would have been ineffective in preventing native forest loss, because tree plantations are more profitable and NFL regulations were weakened by the industrial coalition that opposed—and strongly shaped—the final legislation. Effective incentives for protecting early-successional forests and shrublands are needed to mitigate further losses and foster recovery of Chile’s native forests.     

How do manufacturing exports react to the real exchange rate and foreign demand? The Chilean case

How do manufacturing exports react to the real exchange rate and to foreign demand? We investigate this question with a Chilean panel data spanning from 2003Q1 to 2016Q4, using publicly available data. In the long term, we find that exports strongly co-integrate with external demand, whereas not with the level of the real exchange rate. The short-run elasticities of manufacturing exports differ in size: (a) the elasticity of foreign demand—approximated by trading partners' activity aggregates—ranges between 0.8 and 1.4; and (b) the elasticity with respect to the bilateral real exchange rate is comprehended in the interval [0.4–0.6]. Core estimated elasticities pass usual robustness checks. The fall in manufacturing exports' growth in 2014–16 is consistent with a persistent slowdown in foreign demand, which has been partially offset by an average depreciation of the bilateral real exchange rate (with respect to destination countries of these exports). The transience of the effect of the real exchange rate is coherent with its exhibited stationarity and also consistent with its role of shock absorber.