Assessing industrial policies in Chile remains a rather contentious and divisive topic. Chile has long been held up as an almost鈥恡extbook example of the success of 鈥榣etting the market work鈥�, as there was a broad agreement among mainstream economists that Chile has largely succeeded in promoting strong and stable growth because it has embraced free market policies. At first glance, this may seem believable. Afterall, Chile has one of the fastest growth rates in Latin America since its neoliberal turn in the 1970s. Despite the continuing significance of copper, it has also managed to diversify into other sectors and acquire new competitive advantages between the 1960s and 1990s. The dominant view sustains that the successful emergence of new competitive sectors in Chile鈥檚 export basket are the result of four decades of commitment to liberalization and free market policies. However, this post, which is based , shows that Chile鈥檚 export diversification was not the result of free market policies, but of carefully crafted government interventions. The idea of Chile as a 鈥榝ree-market miracle鈥�, as first described by Milton Friedman, is therefore one of the most enduring myths associated with recent economic development history.
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