The Transformation of Power in Pinochet’s Era

Abstract

This chapter, inscribed within the first phase of the deep hermeneutic matrix defined in Chapter 4, reviews the origin and trajectories of the structural transformations, and their social effects, that occurred in Chile as a consequence of the implementation of a neo-liberal political economy model during Pinochet’s regime (from September 11, 1973 to March 10, 1990). Furthermore, the chapter also highlights the inheritance and preservation of the aforementioned structural transformations, and their social consequences — mainly social inequality — in the post-Pinochet democratic period (1990–2006). In other words, this chapter seeks to define the initial character of the political economy model faced by the new Chilean political elites, which took power in March 1990, and on which a particular consensus would be built up during the following democratic period. The chapter presents three fields of analysis: first, a review of the changes experienced by the structure of economic production as a result of the trade and exchange liberalization policies; second, a review of the composition and change of ownership, focusing on the evolution of the largest economic conglomerates; and, finally, an analysis of the modifications of class structure and their impact on income inequality, brought as a consequence of the new economic model.