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FISCAL AFTERSHOCKS: TAXES AND CATASTROPHES IN CHILEAN HISTORY

Published online by Cambridge University Press:  24 May 2021

Magdalena Gil Open the ORCID record for Magdalena Gil [Opens in a new window]  and
Jorge Atria Open the ORCID record for Jorge Atria [Opens in a new window]
Magdalena Gil
Affiliation:
Pontificia Universidad Católica de Chile, Santiago, Chilea
Jorge Atria
Affiliation:
Universidad Diego Portales, Santiago, Chileb
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Abstract

Socio-natural disasters remain underexplored events in economic history, even though they stress societies in several ways and are known for their relationship with institutional change. In this paper, we explore this issue showing that major earthquakes in Chile have become a window of opportunity for important fiscal reforms. Our findings indicate that there are two mechanisms to explain this relationship: first, reconstruction demands greater state expenditure and intervention; and second, the emergence of narratives that justify these reforms, such as patriotism and solidarity. However, data show that in the case of Chile, changes following disasters have had little impact on the overall tax structure of the country, and the historical preference for indirect taxes has been maintained, with limited power to impose taxes on high-income groups.

Resumen

RESUMEN

Los desastres socio-naturales no han sido mayormente explorados por la historia económica, aun cuando suelen generar crisis de gran envergadura y es sabido que son capaces de generar importantes cambios institucionales. En este artículo exploramos este tema mostrando que, en Chile, los grandes terremotos han generado ventanas de oportunidad para importantes reformas fiscales. Nuestros resultados indican que hay dos mecanismos para explicar esta relación: primero, la reconstrucción y recuperación post desastre demanda alta inversión pública, y esto a menudo significa mayores impuestos. En segundo lugar, la aparición de narrativas que justifican las reformas, como patriotismo o solidaridad. Sin embargo, los datos muestran que la mayoría de los cambios han tenido poco impacto en la estructura tributaria general del país, debido a dificultades para incluir impuestos a grupos de altos ingresos y una preferencia histórica por los impuestos indirectos.

Keywords

taxationdisastersinstitutional changepatriotism-solidarityfiscal policyH62H20H50impuestosdesastresinstitucionespatriotismosolidaridadpolítica fiscal

Information

Type
Articles/Artículos
Information
Revista de Historia Economica - Journal of Iberian and Latin American Economic History , Volume 40 , Issue 2 , September 2022 , pp. 273 - 311
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Copyright
Copyright © The Author(s), 2021. Published by Cambridge University Press on behalf of Instituto Figuerola, Universidad Carlos III de Madrid

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Footnotes

a

School of Engineering, National Research Center for Integrated Disaster Risk Management (CIGIDEN). mogil@uc.cl

b

Department of Sociology, Centre for Social Conflict and Cohesion Studies (COES). jorge.atria@mail.udp.cl

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