Internal and External Factors Explaining Chilean Economic Activity

Abstract

The objective of this paper is to find which factors were the most important to explain the contraction of the economic activity in Chile during the last three years. The results show that: (1) the fall in the rate of growth of the economy is explained by external factors, like the end of the mining boom; (2) the subsequent and persistently low growth rates are explained by a combination of internal and external factors, where the internal factors were the most important.