The de-financing of the social policies, the central bank as a lender of the State and the failure of the developer model (Chile, 1932-1955)

Abstract

In this article, the unexpected consequences of the financing of ISI policies in Chile: the under-financing of social policies, the need to resort the credits of the Central Bank to avoid fiscal deficit, and the resurgence of an acute inflationary cycle are analyzed. The conclusions of this research suggest that the main historiographical approaches on this period (based on an alleged relations between the increase on living standard and the industrialization process) need a radical rethink.