This book examines the relationship between free markets and democracy. It demonstrates how the implementation of even very painful free-market economic reforms in Chile and Mexico have helped to consolidate democratic politics without engendering a backlash against either reform or democratization. This national-level compatibility between free markets and democracy, however, is founded on their rural incompatibility. In the countryside, free-market reforms socially isolate peasants to such a degree that they become unable to organize independently, and are vulnerable to the pressures of local economic elites. This helps to create an electoral coalition behind free-market reforms that is critically based in some of the market's biggest victims: the peasantry. The book concludes that the comparatively stable free-market democracy in Latin America hinges critically on its defects in the countryside; conservative, free-market elites may consent to open politics only if they have a rural electoral redoubt.

State, Market and Democracy in Chile assesses the quality of Chilean democracy by examining the impact of free market reforms on the urban poor's incentives for political participation and capacity for collective action. Through in depth analysis of labor market, social welfare and state reforms, along with extensive interviews with party officials and shantytown residents, this book reveals the manner in which neoliberal reform has undermined the urban poor's incentives and ability to hold public officials accountable. In so doing, it demonstrates the manner in which economic liberalization has negatively affected the quality of Chilean democracy.

In 1990, after almost 17 years of military rule, Chile became the only Latin American country where a democratic regime coexists with free market policies which actually work. The book explores this paradox, and it examines the prospects for future economic growth with income redistribution under free market rules and democratic politics. The author examines amongst other things, short-term policymaking, education, health, the labour market, women, the middle sectors, privatisation, market imperfections, the state, non-government organisations, external trade, the financial sector and the external debt.

This book analyzes Chile's political economy over the last 30 years and the country's attempt to build a market society in a highly inegalitarian society, now as a member country of the Organization for Economic Cooperation and Development (OECD). The investigation provides a historical background of Chilean economy and society and discusses the cultural underpinnings of the imposition of free markets, the macroeconomic and growth performance of the 1990s and 2000s and the social record of privatization of education, health and social security. The treatment documents the growing concentration of economic power among small groups of elites in Chile and discusses the limits of the democratic system built after the departure of the Pinochet regime.

"This polemic treatise attempts to prove that Chile's post-Allende neoliberal experiment cannot and should not be considered a 'miracle.' It contains a frontal attack against the free market, privatization, and trade liberalization principles of Chile's neoliberal paradigm"--Handbook of Latin American Studies, v. 57.