Chile abolished import substitution and embraced export-led liberalization in the mid-1970s

Evidence

Beginning in 1976, the economy slowly recovered. At the time, neoliberals claimed credit for the economic recovery, although they would later blame the crisis of the 1980s on the military government’s reluctance to heed their advice. Implicitly recognizing that monetarist policies alone could not halt inflation, revaluations of the exchange rate were introduced that successfully forced down inflation under 100 percent. Rising world market prices for copper and a stronger growth of exports improved the country’s balance-of-payments position. The new development strategy still included some incentives for nontraditional exports, but the focus was on export sectors with solid comparative advantages. Earlier strategies of import substitution designed to broaden the country’s industrial base were rescinded. Chile affirmed its commitment to free trade and financial liberalization by its resignation from the Andean Pact in January 1977 and the removal of obstacles to foreign financial investment (Ffrench-Davis 2003). The traditional import substitution regime was effectively abolished. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1578

Categorization

• XREF: Connects to the wider historiography of neoliberalism’s export-led growth doctrine and later Latin American dependency debates. — connects to: The late-1970s neoliberal export-oriented development paradigm was conceived in the 1950s — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 159; Uncontrolled financial liberalization and consumption-fuelled borrowing collapsed Chile’s economy in 1982 — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 1594; Chile privatized even profitable state firms beyond crisis-nationalized ones, deepening foreign capital ties — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 1604 (+1 more)

Broader Connections

• Uncontrolled financial liberalization and consumption-fuelled borrowing collapsed Chile’s economy in 1982 #expands (0.85) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1594
• Chile privatized even profitable state firms beyond crisis-nationalized ones, deepening foreign capital ties #expands (0.78) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1604
• Chile’s 1979 labor law weakened unions by forcing them to compete and individualizing bargaining #expands (0.75) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1586