Chile: Towards inclusive development

Abstract

This paper suggests that Chile needs to adopt a renewed longterm development strategy tending towards inclusive development with increasing equity in order to supersede the undesirable effects of the current economic growth pattern, namely the persistence of unacceptable inequality in incomes, living standards and quality of life and a growing feeling of social exclusion. To address these issues, it first charts the development of inequality over the past two decades. It then goes on to analyse the characteristics of the production structure in the Chilean economy, as these are believed to be a determinant of inequality. Drawing on this analysis, it outlines a renewed strategy designed specifically to include the different production and social strata involved in the growth process. Lastly, it identifies the policy areas critical to inclusive development.