Description

Long-run growth in Chile is perhaps one of the most relevant discussions in public policies. This paper seeks to make a contribution to this discussion. It begins by emphasizing the role that, monetary policy and macroeconomic policies in general, have played not only controlling inflation, but also, in promoting a less volatile economic cycle; two characteristics that are very important to create an economic growth enhancing setting. Next, I discuss some of the strengths and weaknesses about Chilean economic growth and some relevant tasks that remain pending. Then, long-run economic growth potential is analyzed, and it is argued that it is difficult to defend the hypothesis that this growth potential is too differ ent from that ten years ago. Finally, I discuss the way monetary policy operates under Inflation Targ eting scheme, in a setting in which there is uncertainty about our true producti ve potential of the economy.