Direct government subsidy (AFD): 40 years in Chilean higher education

This is the authors' abstract. We don't add key points for this paper.

The Chilean State provides resources to the Universities of the Rectors’ Council of Chile to finance their management through a competitive allocation model called the Direct Government Subsidy (AFD). This study analyzes whether the subsidy promotes efficient and productive management, given the specificity of the model. The distribution initiated in 1981 is compared with the assigned contributions for 2020, revealing that AFD is not related to higher academic productivity but responds to targeting in the definition of administration variables, without necessarily increasing academic productivity. The AFD public policy needs revision to incentivize and reward productivity while preventing negative side effects. Path Analysis (a special case of Structural Equation Models - SEM) and the Partial Least Squares - PLS approach are used to justify the relationships.