Chile: Selected Issues

International Monetary Fund

No 2015/228, IMF Staff Country Reports from International Monetary Fund

Abstract: This Selected Issues paper examines the effect of lower copper prices on Chile’s growth at various time horizons. This paper discusses the copper outlook and suggests that the fall in copper prices is likely to have a persistent (although not permanent) effect on GDP growth. It argues that copper prices are unlikely to return to historical highs in the near future. The paper also provides theoretical and empirical evidence supporting the view that long-term GDP growth will not be affected, but the transition toward a lower GDP level can take up to a decade.

Keywords: potential GDP; volatility model; GDP loss; infrastructure capital; GDP deceleration; tax reform; reform agenda; OECD average; household income; copper price peak; Metal prices; Labor force; Infrastructure; Capital income tax; Commodity prices; Global; Asia and Pacific (search for similar items in EconPapers)
Pages: 33
Date: 2015-08-06
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