Banco Central de ChileRevista Economía Chilena
Published Issues
Volumen 1 Nº 2 Diciembre 1998
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| Evolution and Importance of Consumption Credit in Chile Andrea Butelmann / Oscar Landerretche Consumer debt, both with the commercial and the financial sector, has been rising quickly during the past decade. Both economic authorities and analysts are worried about high consumer debt growth although the roots of this preoccupation are seldom made explicit. This article attempts to identifiy the macroeconomic effects that high consumer debt growth may cause. Both international cross-country and Chilean time-series evidence suggest that Chilean consumer debt is not abnormally high and that its rate of growth was declining even before the start of the Asian crisis. Consumer debt is shown to be the most procyclical credit category, a finding that has implications for the effectiveness of monetary policy. Finally the paper provides preliminary evidence showing that more access to credit by larger consumer groups may have had some negative effects on private saving. |
| The Effects of the International Financial Crisis on the Chilean Economy Leonardo Hernández / Pamela Mellado This paper analyzes the effects on Chile of the international financial crisis that started in mid 1997 and evaluates the policies adopted by the economic authorities during 1998 in response to them. The channels of contagion evolved in tandem with the crisis, shifting from trade-related effects (lower international commodity prices) to finance-related consequences (more costly and less available foreign finance). The policy response has been aimed at reducing the current account deficit and making the Chilean economy less vulnerable. The paper concludes that the temporary cost in terms of lower growth is worth paying for, avoiding a surge in domestic inflation and, more importantly, reducing the likelihood of future balance-of-payments crisis, with much higher future employment and output costs. |
| Indexation: Historical Characteristics in Chile and International Experience Oscar Landerretche / Rodrigo Valdés The purpose of this paper is twofold. First it reviews the history of indexation in Chile since 1938, focusing on interpreting indexation in the historical, political, and economic context of Chilean economic development. Second, it analyzes the experience of a selected group of countries to address three questions: how do wage indexation and the level of inflation relate to each other?, what happens to the real exchange rate and inflation when the nominal exchange rate is indexed?, and what is the experience with de-indexation in labor markets? The main conclusions are that wage indexation does not automatically appear in response to any inflation surge; that wage or exchange rate indexation leads to higher inflationarv levels, volatilitv and persistence; and that de-indexation in labor markets has been observed in response to the need to cut real wages in order to boost competitiveness or to address high unemployment, and/or the need to reduce inflationary inertia as part of a stabilization plan. |
| Books review |
| Central Banking in Theory and Practice por Alan S. Blinder. Jorge Marshall Las Crisis Bancarias en América Latina, compilado por Ricardo Hausmann y Liliana Rojas-Suárez. Fernando Ossa |
| Publications Review |
| Catastro de publicaciones recientes y resúmenes de artículos seleccionados. |