Poverty and Inequality in Chile: Are Democratic Politics and Neoliberal Economics Good for You?

Abstract

This article examines whether the free-market, open-economy model adopted by Chile's civilian, democratically elected administrations — of Patricio Aylwin (after March 1990) and Eduardo Frei (after March 1994) — has affected the country's distribution of income and degree of poverty and, if so, how. The free-market model was inherited from the military regime headed by General Pinochet (1973-1990) and adopted by his civilian successors almost without modification despite the fact that the post-1990 administrations were explicitly committed to making alleviation of poverty and reduction of inequalities in income a top priority. The article examines the extent to which the determinants of poverty and inequality have changed (if, indeed, they have changed at all) since the end of the military regime in 1990 — and if so, why.