Free Markets and Democratic Consolidation in Chile: The National Politics of Rural Transformation

Military rule in Chile (1973-1989) produced a profound neoliberal reorganization of the national developmental trajectory and was followed by a peaceful return to democracy. However, the surface confluence of economic liberalization and democratization in Chile belies a more complex interrelationship. On the one hand, neoliberalism has been a key factor facilitating democratic transition and consolidation through the rural political base it has provided for conservative elites, thereby increasing their commitment to the national regime. On the other, it has done so in part by limiting vigorous democratic competition to urban areas. In the countryside, neoliberalism has produced levels of atomization, organizational decay, and economic vulnerability so severe as to inhibit autonomous political participation. The lesson here is that democratization and economic liberalization are sectorally differential processes and that these sectoral differences are essential to understanding the relationship between them. Put simply, free markets and democracy are mutually reinforcing at the national level in Chile in part because of the tensions between them in the countryside.