#46 Inflacion Con Recesion: Las Experiencias de Brasil y Chile
By Alejandro Foxley
Trabajo presentado a la Conferencia sobre "Políticas de Estabilización en América Latina" organizada por el Woodrow Wilson International Center for Scholars.
Summary
This paper is a comparative study of the stabilization programs undertaken by the military governments of Brazil 1964-1968 and Chile 1973-1978. During the first phase of implementation, the two programs had much in common: orthodox monetarist policies were undertaken together with a severe reduction in real wages. Labor unions were not allowed to operate, and the main thrust of policy was to bring inflation down while at the same time reorienting resources towards the private capitalist sector. Brazil after 1967 took a turn towards a more heterodox policy, with interesting results that signaled the beginning of the so - called "Brazilian Miracle." The Chilean case, on the other hand, is perhaps the most consistent application of the orthodox monetary prescription. Thus, despite obvious differences in initial conditions and in the structural characteristics of both economies, the comparison is likely to shed light on some important policy issues.
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