CHILE

Chile’s status performance ranks in the lower mid-range (rank 22).

Chile’s democratic deficit in relation to the frontier OECD countries is less a consequence of existing democratic insitutions and procedures than it is a result of the social inequities associated with high levels of income and wealth concentration.

The country’s socioeconomic performance derives from an economic system that is built on free market principles and is integrated into world markets. The government targets macroeconomic stability but it also plays an active role in regulating economic activity by providing social protection and transfers to the poor and disadvantaged.

Chile ranks 23rd in terms of its quality of democracy.

The peaceful and orderly transition in 2010 from 20 years of leadership under a center-left coalition to a center-right coalition is evidence of a viable, mature democracy.

The electoral process follows democratic principles but falls short of reaching OECD standards.

An oligopolistic media market limits the formation of a pluralistic public opinion sphere.

The country still faces unresolved ethnic conflicts that often result in violations of the civil and political rights of ethnic minorities. Some political discrimination persists as a legacy of the military dictatorship of the past.

At position 11, Chile ranks well above the OECD average in this category.

Achievements in economic development since the mid-1980s have been remarkable, but more could be done to facilitate growth and reduce inequities in income and wealth.

Labor market policy still applies many restrictions which serve as disincentives to formal sector employment. Levels of structural unemployment and informal employment are relatively high for an OECD member.

The tax system is moderately complex. Tax and non-tax revenues are sufficient to cover government expenditures. Budgetary policy has surpassed expectations in reducing national debt and accumulating reserve funds.

Chile’s social affairs assessment falls into the lower mid-range of an OECD comparison (rank 21).

Chile has had a dual health system in place for three decades, providing broad-ranging coverage to most of the population but with substantial variation in the quality of care.

Income and wealth concentration is very substantial, and social mobility low. More broadly, levels of social inclusion and cohesion are also low. The government has started to respond to these shortcomings.

The broad availability of preschool education gives many mothers the ability to work, while leaving their children in nurseries or kindergartens.

The fiscally stable pension system combines a redistributive means-tested pillar with a self-financed pillar.

External security is effectively provided for. Chile’s armed forces are endowed with sufficient professional personnel and equipment to create a military force strong enough to dissuade potential aggressors. Institutional reforms targeting the operational structure have been initiated, but implementation is very slow and somewhat ineffective.

Internal security policy is much less successful. While organized crime is not a perceived threat among average citizens, there are some disturbing trends: selective ethnic-based acts of terrorism; rising drug trafficking (and related crime); and a sharp rise in common crime activities ranging from petty crime to murder.

With particular weaknesses in human capital development, Chile’s resources sustainability polices place the country low (rank 27) in OECD comparison.

Beginning in 2010, the country was slated to introduce a modern system of environmental institutions. However, these policies were designed to comply with international market standards rather than being driven by ecological sustainability.

R&D expenditure as a share of GDP is very low compared to other OECD countries. Most of this spending is undertaken by the government, not the private sector.

School and educational attainment levels are very mixed and generally much lower than the OECD average. High quality education is typically accessible only to those who can pay for it.

At rank 18, Chile’s management performance is on par with the OECD average.

In recent years, the executive branch has demonstrated acumen in steering policies. Thanks to president’s oversight, policies are efficiently implemented, at least in those areas considered important. However, local governments do not always receive adequate funding to carry out directives.

The country actively participates in a number of international fora and demonstrates willingness to adapt to new international developments. Improvements to strategic capacity have been made through reforms in institutional arrangements.

The prevalence of tabloid content in public media translates into poor policy literacy among the citizenry.

At rank 12, Chile’s steering capability falls in the OECD’s upper middle range.

The president oversees strategic planning, but line ministries also have considerable influence in the process. NGOs and academic experts play an important role in government decision-making.

All new legislative proposals must be accompanied by a report summarizing the expected fiscal impact and the financial implications for the government budget.

Consultations with civil society groups and stakeholder organizations take place frequently. Strategic communication often tends to be rather haphazard at the beginning of presidential terms, but improves as each administration gains experience.

At rank 19, Chile falls into the lower-middle range in terms of policy implementation.

Government efficiency varies widely. In areas such as the general budget where benchmarks and oversight mechanisms are strictly enforced, performance is excellent. Less well-monitored areas show very substantial drop-off in efficiency. The president’s office monitors and evaluates ministers’ policies, while budget allocations serve as a strong instrument of control.

Though local governments legally enjoy a considerable degree of autonomy, the central government exercises strong control over municipal budgets, accounting for a large proportion of local revenue. Insufficiently funded policy mandates are not uncommon.

At rank 23, Chile’s institutional learning capacity falls into the OECD’s lower middle range.

The Bachelet government focused on fiscal-political constraints rather than on changes or adaptations entailing additional expenditure. The government participates actively in the coordination of joint reform initiatives, particularly within the Latin American context.

The Ministry of Finance assesses the adequacy of institutional arrangements in the case of new legislative proposals, but there is no specific government institution assigned to monitor existing institutional arrangements.

At position 22, Chile falls into the OECD’s lower middle range in terms of executive accountability.

Citizens’ abilities to evaluate government policies varies widely. Print media discussion of policy reform proposals and government programs is relatively widespread, but a large share of population is excluded from this debate as a result of poor education or a lack of political sophistication.

Parliamentary committees have reasonably strong executive oversight powers. Requested documents must be delivered by the government within legally defined time limits.

The media does not play a significant oversight role. Newspapers and the main public TV stations report tabloid-style news. Little time is spent discussing in-depth political information.