State neutrality, business elite and the lack of export services development in Chile: an exploratory qualitative analysis

- 24 January 2020

Trade topics: Trade and Development, Trade in Services

Economic development process implies, among other things, export expansion beyond natural resources and towards more knowledge intensive sectors. However, a common problem within developing countries is the lack of economic and political elite's ‘entrepreneurial push’ in order to diversify such exports. The Chilean economy is not an exception as its export basket is still characterized as being anchored in natural resources. This feature has persisted despite the prevailing consensus on the importance of diversifying the economy towards new industrial and service sectors, both beyond and within natural resources. This paper focuses on the causes of the absences of such an 'entrepreneurial push', looking into the failure of the development of a services export sector in the country. Through a qualitative exploratory analysis of elite's perceptions, we study the predominant hypothesis among key stakeholders. We argue that the rentier character of the economic elite and the lack of state support for productive transformation are the main causes of both Chile's export stagnation and the incapacity to diversify towards more knowledge intensive sectors such as services.

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