Cities 65 (2017) 3250

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Cities

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City prole

City prole: Actually existing neoliberalism in Greater Santiago

Matias Garreton
Universidad Adolfo Ibaez - Centro de Inteligencia Territorial, Presidente Errazuriz 3485, Las Condes, Santiago, Chile.

a r t i c l e i n f o a b s t r a c t

Article history: Greater Santiago, the capital of Chile, concentrates most of economic and political power of this nation and 35% of
Received 29 March 2016 its population. It is a conurbation of 6 million inhabitants, comprising 37 municipalities without a metropolitan
Received in revised form 1 February 2017 level authority, where large scale planning is executed by centralized authorities. The historic development of
Accepted 15 February 2017
this metropolis was sharply modied by neoliberal policies that were implemented during Pinochet's dictator-
Available online xxxx
ship and by the constitutional denition of a reduced Subsidiary State. These structural reforms had a strong im-
Keywords:
pact on urban development, due to the weakening and incoordination of sectoral planning agencies and the
Chile progressive accumulation of socio-spatial inequalities. After the recovery of democracy, a stronger emphasis on
Urban inequalities social policies was promoted, but public action became increasingly dependent on private providers of public
Planning goods. Nevertheless, the early adoption of modern regulations and a sustained period of economic growth
Housing have allowed for important advances in quality of life and to considerably reduce poverty levels. This article
Transportation aims to provide a systemic and critical study of Greater Santiago's institutions, living conditions and the urban
Privatization outcomes of market-driven planning, considering historical processes and the present contradictions in a partial-
ly modern but segregated metropolis. In conclusion, the uniqueness of Greater Santiago's neoliberal development
is discussed, highlighting the concentration of power, the inuence of capitals over policy design and the strong
socio-spatial inequalities that reect direct wealth circulation from natural resources extraction to nancial and
real estate rents, in the absence of a strong industrial sector. However, emerging policies and the expected rst
elected regional governments suggest ways to advance towards more inclusive, participative and intersectoral
forms of public action, under the pressure of civil demands for a fairer distribution of wealth, public goods and
decision power.
2017 Elsevier Ltd. All rights reserved.

1. Introduction
Santiago, the capital city of Chile, has concentrated the political
power of this country during most of its history and has acquired a dom-
inant productive and demographic weight during the last century.
Alongside the industrialization process that begun in the 20th century,
this city progressively acquired a hegemonic position, actually concen-
trating 35% of Chile's population, 46% of its GDP and most of the political
and economic powers of this nation (Orellana, 2009). Nowadays, Great-
er Santiago is a conurbation of 6 million inhabitants that has integrated
former rural towns, comprising 37 municipalities without a metropoli-
tan level authority, where large scale planning is executed by sectoral
ministries and a regional presidential delegate, the Intendente.
In recent history, the coup d'tat and Pinochet's dictatorship had
deep political and economic consequences, also involving a major
socio-spatial restructuration that continued after the recovery of
This work was supported by the Centre for Social Conict and Cohesion Studies (COES,
CONICYT/FONDAP/15130009).
E-mail address: matias.garreton@uai.cl.
democracy in 1990. Thus, Greater Santiago has become a deeply segre-
gated city, where prosperous and globalized neighborhoods coexist
with impoverished and violent areas. Average living conditions and
quality of life have progressed considerably, due to income growth, im-
proved housing standards and infrastructure development, but the mit-
igation of urban inequalities and the improvement of planning
capacities are major challenges for the sustainable development of
this city.
Greater Santiago's segregation has been extensively studied
(Hidalgo, 2007; Sabatini, 2000; Sabatini & Brain, 2008; among others),
also the historical place of Chile as one of the earliest neoliberal experi-
ments (Garate, 2012; Harvey, 2003, 2005; Peck, Theodore, & Brenner,
2009) and the uneven urban development produced by these reforms
(Fernndez, Manuel-Navarrete, & Torres-Salinas, 2016; Rodriguez &
Rodriguez, 2009) have been documented by previous research. Howev-
er, a systemic perspective of these institutional and urban transforma-
tions is lacking, considering the uniqueness of local path dependency
and the resemblance of Chilean neoliberal reforms with global
processes.
The actually existing neoliberalism literature (Brenner &
Theodore, 2002; Peck, Theodore, & Brenner, 2012, among others)

http://dx.doi.org/10.1016/j.cities.2017.02.005
0264-2751/ 2017 Elsevier Ltd. All rights reserved.
 M. Garreton Cities 65 (2017) 3250
provides an adequate conceptual framework in order to characterize
the processes that have shaped Greater Santiago. This notion refers to
a global process of establishing market discipline over previous institu-
tional frameworks, in different ways that depend on local path-
dependence, evolving because of the crisis that it produces while deeply
reshaping the political-economic space of cities (Op. cit.). This frame-
work helps to identify the processes and outcomes that are distinctive
and those that are shared with other cases, outlining the unique combi-
nation of power relationships and urban processes that characterizes
Chile's capital city.
This city prole aims to provide a critical study of Greater Santiago's
living conditions and planning institutions, considering the achieve-
ments of economic growth and modernization, but highlighting the re-
lationship between market-oriented planning and the production of
socio-spatial inequalities that impose severe limitations to the self-
realization of excluded groups. Most of these subjects have been sepa-
rately developed by previous research, but this integrated critical anal-
ysis - including historical processes, the recent evolution of planning
institutions, the present contradictions in a modern but segregated me-
tropolis and the uniqueness of this city within global neoliberal plan-
ning - is an original contribution to urban and Latin American studies.
This article will present a brief history of Santiago and a discussion of
its present conditions, in the following sections: Santiago from its foun-
dation to the rst half of the 20th century; the neoliberal turn during
Pinochet's dictatorship; the creation of public policy markets and the
nancialization of public policies in democracy; the actual structure
and living conditions of this city; and an analysis of the urban outcomes
of power relationships. In conclusion, the unique form of actually
existing neoliberalism in Greater Santiago will be discussed, in the per-
spective of expected reforms of metropolitan governance.
2. Centralization and industrialization: Towards Santiago's
hegemony
Santiago was established in 1541 in the valley of the Mapocho River,
as the capital of the General Captaincy of Chile, a colony of the Spanish
empire (Fig. 1). It endured attacks from indigenous tribes, epidemics,
earthquakes and oodings, but it grew and was consolidated as the
main city of this colony. Notably, it functioned as the administrative
headquarters of the prolonged war between the conquerors and the
Mapuche people, mainly disputed at a frontier 600 km to the south of
Fig. 1. Santiago in the 16th and beginning of the 20th century.
Source: http://archivovisual.cl/.
33
this city. The position of Santiago as a key power center for controlling
the national territory was reasserted shortly after Chile's independence
(18101818), following the Conservative party's victory in the battle of
Lircay (1830) and the enactment of the 1833 Constitution, which
established a centralized presidential regime (Ortiz & Valenzuela,
2013).
The population and economic production were evenly distributed in
the rst century of the Chilean republic, with several important cities
that controlled commercial activities in different regions (Geisse,
1978). This situation started to change with the development of saltpe-
ter mining in the north of Chile (18661929), which created economic
surpluses expanded the budget of the state and accelerated urbaniza-
tion trends. This allowed for public investments in railway networks
and urban infrastructure that were particularly advantageous to Santia-
go, which became the major transport node of the country and benet-
ed from important public works, including public spaces, new avenues
and an effective channeling of the Mapocho River to prevent oodings.
State-nanced mortgages were offered to big landowners to increase
agricultural production, strengthening the ties between the centralized
bureaucracy and the oligarchy, which progressively migrated to the
capital (Op. cit.).
During the First World War, national industries were boosted by the
combination of an increased international demand for saltpeter and a
reduction of imports. This accelerated rural-urban migrations, especial-
ly towards Santiago, where the concentration of state employees and
the upper classes provided additional demand for services and
manufactured products (Geisse, 1978). The Great Depression heavily
impacted Chile, as demand for mining exports collapsed and unemploy-
ment soared. Unemployed miners migrated from the north towards
southern cities, mostly to Santiago. The state responded to the crisis
with an ambitious industrial policy, boosting internal demand and re-
placing imports (Salazar & Pinto, 2002). The simultaneous convergence
of a strong state bureaucracy, private capitals, unemployed population
and the political organization of the middle classes in Santiago, led to
a spatial concentration of the developing industries in this city and rein-
forced its already rising population share (Figs. 1 and 2), sustaining an
irreversible process of urban dominance in Chile (Geisse, 1978).
The consolidation of a developmental state in Chile, characterized by
the political, demographic and economic centralization in Santiago and
by decisive public investments and subventions in the industrial sector,
also had important consequences for urban planning in this city. The
34 M. Garreton Cities 65 (2017) 3250
Fig. 2. Evolution of Santiago and Greater Santiago's population.
Sources: population censuses, National Institute of Statistics (INE). Note:
*Santiago's population is accounted for increasing areas over time, due to
changes of administrative boundaries and conurbation processes.
power of the state bureaucracy was materialized in the massive devel-
opment of downtown Santiago (19361946), with modernist buildings
for ministries and public services, a characteristic network of commer-
cial alleys and medium height residential buildings. In the same period,
high income households started to migrate towards the northeast of the
city, making their ancient residences and palaces available for commer-
cial and institutional purposes. As a response to the workforce growth,
successive ambitious housing policies were implemented since 1943 -
notably through the creation of the Housing Corporation (CORVI) in
1952, sewage systems were extended throughout the city and new pub-
lic spaces were created (Gross, 1991). Although the Chilean develop-
mental state lacked the extensive social security that characterized
European welfare states, in the late sixties it was able to mobilize a con-
siderable economic and urban planning power through two key
ministries.
On one hand, the Ministry of Public Works (Ministerio de Obras
Publicas, MOP), created in 1887, was and continues to be the most pow-
erful branch of government in terms of public investment. It had a
strong engineering corps that developed ambitious plans for transport
infrastructures - which were fully realized decades later - such as Great-
er Santiago's subway and its international airport. On the other hand,
the Ministry of Housing and Planning (Ministerio de Vivienda y
Urbanismo, MINVU) was created in 1965 from MOP's architecture divi-
sion. From its beginning, it had considerable planning and nancial ca-
pacities and nowadays it has the second highest investment budget
among public agencies. From the MOP, the MINVU inherited the author-
ity to enforce urban planning while it centralized social housing policies,
which are one of the most important redistributive instruments in Chile
(Arriagada, Sepulveda, Cartier, & Gutierrez, 2004).
A complete description of the developmental state in Chile would go
beyond the scope of this article, but this brief account highlights three
key path-dependence characteristics. First, since the early years of the
republic there existed a close connivance between the economic and
political elites, with important state subsidies and policies that favored
big landowners and industrial capitalists (Geisse, 1978; Salazar &
Pinto, 2002). Second, this relationship was progressively reinforced in
Santiago, due to the centralization of political power and the migration
and reproduction of the oligarchy in this city; this concentration of pub-
lic and private wealth contributed decisively to the urban development
of Santiago (Geisse, 1978; Ortiz & Valenzuela, 2013). Third, the demo-
graphic growth of Santiago and the progressive political organization
of the working classes led to the implementation of relevant social pol-
icies and creation of ministries with important capacities for urban plan-
ning and housing development, but these were administered by a
technocratic elite that was weakly subjected to democratic accountabil-
ity (Gross, 1991; Salazar & Pinto, 2002).
3. Bending path dependency: From the developmental state to the
neoliberal subsidiary state
The presidential election of 1970 tensioned a political system that
enforced order and consensus in a deeply unequal society, where the
progressive strengthening of social policies since 1929 allowed to con-
tain unrest while decision power remained concentrated in Santiago's
upper classes (Salazar & Pinto, 1999; Ortiz & Valenzuela, 2013). In fact,
the socialist project of Allende involved a major empowerment of the
working classes, which was a serious challenge to the historical alliance
of the political and economic elites in Chile (Garate, 2012). These
reacted with the military coup in September 1973, supported by the
right-wing National party - a conservative-liberal alliance - and by the
center-left Christian Democracy. Once in power, the military govern-
ment violently repressed the opposition, dissolved the congress and
banned all political parties until 1987.
Facing a catastrophic economic situation, Pinochet implemented the
radical proposals of a group of young economists with postgraduate
studies in the University of Chicago, which were strongly inuenced
by Milton Friedman's neoliberalism. Market discipline was imposed as
a shock treatment, abruptly reducing public spending, dismissing one
out of three public employees, privatizing public enterprises,
restructuring social security and labor regulations in order to improve
private capitals' yield (Garate, 2012; Monckeberg, 2001). This economic
ideology was reasserted in the 1980 Constitution, which establishes im-
portant limitations to the economic role of the public sector, in particu-
lar by forbidding any entrepreneurial activity of the state unless a high
quorum law authorizes it (Chilean Constitution, article 19:21). These
constitutional restrictions have shaped a particular form of a subsidiary
state,1 which is inspired in the Catholic principle of preventing the in-
tervention of collective bodies in individual decisions (Barber, 2005)
but reformulated in the sense of giving priority to private affairs over
public economic action. This constitutional restriction and the following
legal interpretations have had deep and long-lasting consequences for
public policy design and urban development, as will be shown in the fol-
lowing sections.
The rst conspicuous manifestation of market discipline in urban
space were the forced eradications in Greater Santiago, which displaced
15,000 low-income inhabitants from illegal settlements and legally
owned social housing, between 1976 and 1978 (Alvarez, 1988;
Lawner, 2007). This process was systematized in the framework of the
National Policy for Urban Development (Politica Nacional de Desarrollo
Urbano, PNDU) of 1979, relocating 150,000 poor citizens from the
northeastern quadrant of the metropolis towards its western and south-
ern margins (Fig. 3). As families were relocated, social housing projects
were built, mandated and subsidized by the MINVU, but developed by
private enterprises (Hidalgo, 2004).
In 1981, municipal boundaries were redened in order to follow
income homogeneity criteria (Hardy, 1989; Sabatini, 2000), thus
creating poor municipalities that allowed to narrow the spatial
scope of subsidiary policies. Municipal administrations were drasti-
cally reformed. Mayors were designated by the military government,
traditional neighborhood associations and any other form of local
democracy were dismantled (Hardy, 1989). Thus, local governments
became instruments for social control, disempowering citizens from
local decision arenas.
1
This economic interpretation of a subsidiary state is very different from the European
subsidiarity principle, which establishes a preference for the allocation of power to small
units of government unless a task can only be achieved efciently at higher levels
(Barber, 2005).
 M. Garreton Cities 65 (2017) 3250
Fig. 3. Eradications in Greater Santiago, 19791985.
Source: Morales, Levy, Aldunate, & Rojas, 1990. Note: Hollow circles
show the original location of the eradicated families and black-lled
circles indicate their destinations. Communities were deliberately
divided in order to dismantle eventual resistance organizations.
In terms of urban infrastructure, the dictatorship delivered some of
the long term projects that had been initiated by the MOP in previous
administrations. Notably, the rst subway line, started in 1969, was in-
augurated by Pinochet in 1975, and the second in 1978. The Ministry of
Transportation (MTT) was created from a former MOP secretary in 1974
and the Transport Planning Secretary (SECTRA) was established in
1981, in order to develop social utility evaluations for transport projects
- considering an intersectoral planning context - and to provide techni-
cal advice to municipalities. However, the State's Enterprise of Public
Transport was dismantled in 1981, after successive budget reductions,
replacing its public transport services with a multitude of small private
providers. This transport deregulation produced a vicious cycle between
soaring fares, excessive offer, service degradation and road congestion,
also worsening air pollution (Figueroa, 1990).
In 1982, the National Planning Ofce (ODEPLAN), advised by the
United Nations Development Program and the Inter-American Develop-
ment Bank implemented a standardized registry of public projects
(BIP), which would evolve towards the National System of Public In-
vestments (SNIP), generalizing econometric evaluation procedures in
order to assess the social utility of each project. The SNIP increased plan-
ning standards but it also contributed to the specialization of the state in
35
the monetary regulation of subsidies, which would lead to a progressive
abdication of concrete planning and development capacities.
In sum, these neoliberal reforms produced an abrupt turn from his-
torical institutions, sustained by a constitutional principle of subsidiarity
that explicitly subdued the state to the market, dismantling the devel-
opmental state and privatizing most of the public productive capacity
(Garate, 2012; Monckeberg, 2001). However, key structural characteris-
tics remained under this restructuration. Chile remained a highly cen-
tralized nation, with most political and economic power concentrated
in Santiago, and the historical alliance between the state and the oligar-
chy was renewed. Concerning planning, the MOP's long-term planning
and the MINVU's social housing policies remained the main instruments
of public investment in cities, even as they lost substantial capacities for
projects' development. Finally, the econometric control over public in-
vestment was strengthened, in general by the SNIP and in particular
by SECTRA, both under the authority of the Planning Ministry
(MIDEPLAN).
4. The neoliberal democracy: From public policy markets to
nancialization of public policies
The democratic government of Patricio Aylwin was installed in 1990,
in a tense political environment. Democracy had been recovered, but
Pinochet retained considerable powers, mainly as lifelong head of the
armed forces. At the same time, there existed acute housing and infra-
structure decits, the state's budget was scarce while the expectations
towards the new democratic regime were high. In this context, the par-
ticipation of private enterprises in producing public goods was justied
in order to focus public resources towards urgent social needs (Silva,
2011). The evolution of these public-private policy markets has follow-
ed different paths, concerning social housing, urban densication and
urban transportation.
4.1. Social housing policies
Reducing the housing decit was a priority of the rst democratic
governments, which considerably increased public spending in this sec-
tor and included a wide array of actors to subsidized housing production
(Hidalgo, 2004). This strategy was successful in quantitative terms, but
implied a further weakening of the MINVU's regulatory capacities. Since
marginal land is cheaper and xed costs shares are lowest with more
housing units, this approach favored bigger social housing develop-
ments at increasing distances from central areas (Fig. 4). Thus, low-
income groups became more acutely concentrated, segregated and
marginalized, while private developers obtained substantial prots
from public subventions (Hidalgo, 2007).
Since 2001, social housing subsidies were gradually reformulated,
from programs that were closely supervised by housing and planning
regional agencies (SERVIU) of the MINVU, towards a voucher system
of individual liquid subsidies that allowed for direct transactions be-
tween families and developers (Fig. 5), weakening the capacity of
SERVIU to guarantee the engagement of a construction project behind
each subvention. These policies have been quantitatively successful,
but social housing quality has been poorly evaluated by repeated stud-
ies over time, especially concerning its location in marginal and homo-
geneous low-income neighborhoods (Ducci, 1997; Brain, Concha, &
Del Campo, 2002; among others).
In 2006, specic subsidies were introduced in order to improve the
accessibility and size of social housing, while social development enti-
ties (EGIS) were created, as private or municipal organizations meant
to organize households in order obtain subsidies and negotiate with
big developers. However, these innovations had a limited success. Hous-
ing sizes signicantly increased from 50 m2 (2006) to 59 m2 (2013),2
2
According to MINVU's social housing cadaster.
36 M. Garreton Cities 65 (2017) 3250

Fig. 4. Location of social housing developments in Greater Santiago by year of building permit.
Source: MINVU's social housing survey.

but their location was marginally improved while the amount of subsi-
dies more than doubled (Fig. 5), suggesting that a signicant part of the
increased funding was absorbed by land rent and speculation (Brain,
Cubillos, & Sabatini, 2007; Cannobio et al., 2011). The EGIS had little ca-
pacity to uphold the interests of beneciaries against big housing devel-
opers (Cannobio et al., 2011), and they were reframed as sponsor
entities in 2011, with a less ambitious scope.
The Quiero mi Barrio (I love my neighborhood) program was a re-
markable policy innovation also introduced in 2006. It aimed to im-
prove urban conditions in poor neighborhoods, including early
community participation and an intersectoral approach. This was revo-
lutionary in the Chilean context, characterized by purely informative
citizen participation and a strict sectoral compartmentalization of public
policies. This program has involved over 500 neighborhoods and
 M. Garreton Cities 65 (2017) 3250 37

Fig. 5. Transition from planned to unplanned subsidies for social housing in Chile.
Sources: MINVU subsidies series, http://www.minvu.cl/opensite_20070322151443.aspx, MINVU cadaster of social housing, 2014.
Note: The UF is a monetary unit, roughly equivalent to 35 US dollars, that is adjusted daily according to ination, so it represents
constant prices. Housing units and built surfaces are accounted as relative values to the quantity produced in 1990.

900.000 inhabitants (about 5% of the Chilean population) but it has
achieved irregular results, with successful interventions such as Santa
Adriana, contrasting with difcult cases, such as Villa Portales, just to
mention two examples in Greater Santiago. The Quiero mi Barrio innova-
tions have raised resistance inside MINVU, particularly due to the in-
compatibility of participatory planning with usual procedures, and
also among other ministries, thus constraining the intersectoral scope
of the program. Nevertheless, the persistence of this program and the
radical change it proposes - through bottom-up community planning -
have had a symbolic impact in Chilean planning that goes beyond its
quantitative results.
renewal, being able to reconcile different interests in the rst stages of
the process, but loosing inuence as market dynamics were intensied
since 2003. Progressive increases in construction heights and regenera-
tion subsidies have boosted residential high-rise development, with
projects that attain over 30 oors (Fig. 6) and provide insufcient com-
pensations in terms of public spaces and urban equipment (Contreras,
2011; Lopez-Morales, 2011).
In recent years, high-rise development has been partially restricted
in downtown Santiago, but this kind of residential development has ex-
panded to neighboring municipalities, in the context of a generalized

4.2. High-rise densication

After Pinochet's dictatorship, the historical core of Greater Santiago

presented a notorious decay, having lost one third of its population
peak, reached around 1950. In order to reverse this situation, the plan
for the repopulation of Santiago was implemented since 1992,
connecting the owners of suitable land with real estate developers, of-
fering generous regeneration subsidies and lifting building restrictions
(Contreras, 2011; Casgrain & Janoschka, 2013). On one hand, this plan
successfully reverted the depopulation of downtown Santiago, gave
new life to deteriorating neighborhoods and reactivated downtown
economic and cultural activities. On the other hand, this provided a
very advantageous opportunity for investing in real estate, providing
high yields for realtors and investors in rental properties. According to
census data, between 1992 and 2012 the resident's composition of San-
tiago changed from 0.9 to 1.5 tenants for each proprietor household,
while afuent young professionals have displaced low income and el-
derly families (Lopez-Morales, 2011).
The corporation for Santiago's development (CORDESAN) - a hetero-
geneous private organization constituted by municipal representatives, Fig. 6. Vacant lot surrounded by high-rise housing in downtown Santiago.
neighbors, developers and banks - was an important actor of this Source: Author.
38 M. Garreton Cities 65 (2017) 3250
Fig. 7. Greater Santiago's new Financial District.
Source: Author, view from the Metropolitan Park. Note: Urban
highways are seen following the Mapocho River, with main
exchangers still being built in order to accommodate increasing
trafc. The southern areas of the city are blurred by usual air
pollution.
competition among local governments, which have integrated the ob-
jective of capital gains as a core objective of urban planning (Lpez-
Morales, Gasic, & Meza, 2012). It must be noted that building permits
represent a substantial contribution for meager municipal budgets, en-
couraging height deregulation in order to increase land rent and attract
big developers (Lopez-Morales, 2011).
This pro-entrepreneurial ethos in urban planning (Op. cit.) also ex-
ists in higher government levels. Zunino (2006) has shown the close
ties between high civil servants of the central government and private
investors, and the inuence they have mobilized to relegate local au-
thorities and citizens directly affected by urban developments to non-
inuential positions. For example, Chile's biggest development,
Costanera Center - which includes a 300 meters-tall ofce spaces
tower, two ve-star hotels and a mall, in a high-end business district
(Figs. 7 and 8) - has avoided mandatory compensations for increased
trafc ows in an acutely congested area. After a brief suspension of
the project at the outset of the subprime crisis, in 2009 the regional
branch of the MTT approved a trafc impact study that proposed road
infrastructure contributions conspicuously below normal standards,
thus unblocking the construction process (CCHC, 2012). Highway ex-
changers are still being built in this area, through toll-nanced conces-
sions with MOP subventions (Fig. 7). Costanera Center is one of many
recent massive ofce space developments that have consolidated a
new Financial District in Greater Santiago, which has displaced the
main nancial command centers from downtown Santiago in only
two decades. This district is strategically located among high-income
neighborhoods in the northeastern quadrant of the metropolis (Figs. 8
and 15).
The opening of Chile's economy to foreign capitals after the recovery
of democracy and the commodities boom between 2003 and 2012 have
fueled a trend of economic growth that has allowed a substantial im-
provement of average living conditions in Greater Santiago, but urban
development has been highly uneven. Notably, 57% of built surfaces in
Greater Santiago have been erected after 1990,3 but the expansion of
key urban functions, such as ofce spaces, public administration facili-
ties, health and education services, has bypassed low-income sectors,
favoring high-income neighborhoods and the proximity to new urban
highways (Fig. 8). In sum, the combination of a massive urban
restructuration and market-oriented planning has increased the in-
equalities between privileged areas that attract urban investments and
neglected areas that mostly receive subsidized social housing.
3 5
Author's calculation with SII data.
4.3. Infrastructure and urban transport
After the dictatorship, Chile had an important infrastructure decit,
which was addressed through a highways concessions system created
in 1991 by the MOP, consisting of state auctions of public works to pri-
vate companies, which recovered their investments through tolls. In
order to avoid bureaucratic delays, the concessions system was de-
signed in a technical and political vacuum that excluded not only social
actors but also stakeholders within the government and state bureau-
cracy (Silva, 2011, p. 43). This framework allowed the MOP to engage
with investors in a bilateral basis, avoiding external regulations and
controls such as SECTRA's intersectoral evaluation, while providing im-
portant state guarantees and advantageous conditions for capital
returns.
Urban highways started to be franchised in 1997 under the same
model, but they faced strong resistance from aficted neighbors. High-
income groups were able to modify the initial designs towards under-
ground highways (Fig. 13), while low-income populations payed the
full environmental costs, even if their public protests retarded some
projects for up to ten years (Landon, 2013). In any case, the state
invested considerable political and nancial capital in order to guaran-
tee the construction of highways and the expected prot margins for
the contractors (Silva, 2011), covering up to 35% of total costs, which
exceeded initial estimations by 55% (Engel, Fischer, & Hermosilla, 2009).
The public-private concessions system was extended from highways
to public transport, in order to resolve the chaotic situation in Greater
Santiago, where hundreds of micro-entrepreneurs serviced uncoordi-
nated and redundant lines. In April 2003, President Lagos issued an ex-
ecutive decree that mandated the implementation of a metropolitan
transport plan that became the Transantiago, a fare-integrated system
consisting of a subway backbone operated by Metro - an autonomous
state-owned company that acts as a private entity with specic restric-
tions - and several bus feeder services that were franchised to private
operators.
Transantiago was an ambitious modernizing effort, but it presented
severe planning deciencies in many respects. In its conception, it
adopted a legal framework that was inherited from highway franchises,
establishing rigid contracts that were inadequate to regulate a variable
demand system (Briones, 2009; Beltrn, Gschwender, & Palma, 2013).
The institutional arrangements for this project involved several minis-
tries with a weak coordination agency that was unable to enforce a com-
mon schedule, resulting in major infrastructure decits - notably lack of
segregated corridors - when the vehicles started to operate (Briones,
2009; Figueroa & Orellana, 2007; Muoz & Gschwender, 2008). The en-
gineering design opted to reduce the number of buses and to increase
their size, improving the expected protability for investors but severe-
ly impairing service quality, because of extended waiting times
(Gomez-Lobo, 2007). Moreover, the new system began to operate
abruptly, without being fully operational and ignoring user's difculties
to adapt to a radically new transport system (Briones, 2009; Muoz &
Gschwender, 2008). Thus, Transantiago's sophisticated engineering
was at odds with a messy urban context, with user's daily mobility rou-
tines and with uncoordinated institutions that were unable to provide
all of the system's required components. As it has been extensively re-
ported, the inauguration of this system was disastrous.
Nowadays, Transantiago is still operating with insufcient road in-
frastructure and irregular services, fare evasion rates amount to 30%4
of expected revenues, causing severe nancial problems to their main
private operators, although public subsidies cover 40%5 of the opera-
tional costs. This level of subventions is not uncommon for public trans-
port, but in return the MTT has relatively weak capacities to improve
this system's quality, due to the rigidity of its contractual framework
and the lack of operational alternatives. In sum, Transantiago reveals
4
According to MTT estimates.
According to the Metropolitan Public Transport Directorate (DTPM).
 M. Garreton Cities 65 (2017) 3250 39

Fig. 8. Greater Santiago's spatial restructuration after the dictatorship.

Sources: 1992 and 2012 censuses, Internal Revenue Service (SII) constructions cadaster. The Internal Revenue Service (Servicio de
Impuestos Internos, SII) of Chile provides an exhaustive cadaster of all built surfaces in Chile at block level, classied by function
and year of construction. Note: the selected built uses include public administration facilities, private ofce spaces, public and
private health and educational buildings.

the limits of the Chilean approach of privatization and improvisation in
urban policies (Silva, 2011), having produced a no-winners situation,
with severe social costs and private prots below expectations.6
Moreover, the incoordination7 between the objectives of the MOP -
franchising highways that foster private transport - and the MTT - de-
veloping public transport - hinders the capacity to cope with trafc con-
gestion, due to increasing motorization rates and urban sprawl. Since
2001 trafc conditions in Greater Santiago have deteriorated, with trav-
el times increasing 20% in public transport and 14% in private vehicles,
and a severe reduction from 3.3 (2001) to 2.5 (2012) daily per capita
trips.8
This section has developed a critical perspective of urban policies
since the recovery of democracy, in order to identify structural trends
of that have increased sociospatial inequalities and affected quality of
life in Greater Santiago as a result of unexpected consequences of
market-oriented planning. However, this has been a period where im-
portant socioeconomic advances have been achieved, crafting a city
that is globalized and modern, but also unequal and underdeveloped
in some areas. In the next section, the actual situation of Greater Santi-
ago will be described, recognizing both the potentials and shortcomings
6
The nancial difculties of Alsacia, the main Transantiago's private operator, have
been largely caused by its incapacity to pay loans engaged over expected prots.
7
SECTRA was created to technically mediate this kind of intersectoral disputes between
ministries and tended to side with the pro public transport position of MTT. However,
since 2010 it was gradually integrated as a sub-secretary of this ministry, losing its inde-
pendence and inuence for intersectoral regulation.
8 10
Author's calculations with 2001 and 2012 origin destination surveys.
of this metropolis, and providing some relevant comparisons in the
Latin-American and global contexts.
5. Actual living conditions in Greater Santiago
Since 1983, Chile has enjoyed a sustained trend of economic growth,
multiplying per capita GDP by a factor of 3.4, with an annual average in-
crease of 4%, attaining 14,626 USD in 2015. The Chilean economy has
globalized since the recovery of democracy, through free trade agree-
ments and a progressive increase of foreign investments. This has posi-
tioned Chile as the richest country in Latin America on a per capita basis,
while Greater Santiago is usually ranked in the top positions of living
standards among cities of this continent. However, Chile and Greater
Santiago have high levels of income inequality, respectively with a
Gini Index of 0.51 and 0.53,9 which is around the average of Latin
America and below several African countries, but it is the 15th most un-
equal country in the world.10 It must be noted that inequality in Chile
has been considerably reduced since 1990, from a Gini index of 0.57.
These general facts highlight the inner tension that characterizes Great-
er Santiago, which has the core of a modern metropolis in contrast to
scattered poor, subserviced and violent territories (Figs. 8 and 17).
This is a dynamic city, with attractive qualities but also severe problems
that must be addressed in order to advance towards a more sustainable
and equitable development, as will be discussed hereafter.
9
Author's calculations with 2013 Casen survey.
Among 176 countries reported in the United Nations' WIID database.
40 M. Garreton Cities 65 (2017) 3250
5.1. Urban sprawl, housing densication and employment concentration
Greater Santiago is simultaneously growing in central and peripher-
al areas, mainly through processes of high-rise densication and subur-
banization (Fig. 9). As mentioned before, high-rise densication mainly
concerns downtown Santiago and northeastern pericentral areas, con-
solidating a compact mixture of housing, commerce and ofce spaces.
Big social housing developments, with moderate heights but high den-
sity, have been mainly developed in the northwest and south of the me-
tropolis (Figs. 4 and 9). Diffuse areas of low density housing extend
towards suburban areas, roughly following regional highways towards
the north and south.
In general, housing dynamics in Greater Santiago can be differentiat-
ed in three sectors: a high-rise core, relatively dense areas within or
next to Americo Vespucio beltway and extending beyond it towards
the south, and diffuse suburban areas (Fig. 9). Considering the last
three censuses, suburban areas show a sustained growth trend, progres-
sively increasing their metropolitan share of housing from 1992 to 2012.
Following previous depopulation trends, downtown Santiago housing
share declined between 1992 and 2002, but this tendency was reversed
between 2002 and 2012, with high-rise developments that also includ-
ed surrounding areas, especially towards the northeast. On the contrary,
construction has been relatively stagnant in-between these core and
suburban areas (de Mattos, Carlos, & Link, 2014).
However, workplaces have not completely followed this demo-
graphic redistribution. Although new commuting destinations have be-
come more relevant in several sectors outside Americo Vespucio,
around shopping malls in areas with relatively high housing densities,
new jobs have been mainly located in a northeastern axis that extends
from downtown Santiago, which remains the main employment center
(Fig. 9). In consequence, trips have become longer and trafc congestion
has been aggravated, also due to increasing motorization trends that ac-
company rising income and suburbanization. Considering a constant
urban area, motorized travel times have increased 24% between 2001
and 2012, and average commuting times have risen from 84 to
100 min,11 consuming more than 3 daily hours for 10% of workers.12
5.2. Demography and economy
Greater Santiago's population has grown at a moderate annual rate
of 1.25% since 2002, attaining about 6 million inhabitants in 2012,13
representing 35% of Chile's population. The median age is 32 years and
life expectancy is high for a Latin-American context, respectively 83
and 77 years for women and men, both a year over Chilean averages.
Compared to the rest of Chile, this city shows an overrepresentation of
young adults between 18 and 40 years, which is related to immigration
for superior education and the rst working years, and symmetric emi-
gration of families with children. This cycle follows the concentration of
the best national universities and of job opportunities, with the counter-
part of higher costs of life and negative externalities, notably travel
times and air pollution. Thus, Greater Santiago has lost its historic at-
tractive for migrants from other Chilean cities, having gained only
0.6% population through migration between 1987 and 1992, attaining
a neutral balance around 2000 (Rodriguez & Gonzalez, 2006) and loos-
ing 1% from 2007 to 2012.14
Greater Santiago has the second highest median per capita income of
Chile15 but it is the city with the highest Gini index in the country.16
Overall, 10% of its inhabitants are under the poverty line,17 a relatively
11
Considering direct two-way trips.
12
Author's calculations with 2001 and 2012 origin destination surveys.
13
Some uncertainty exists about these gures because of methodological aws in the
2012 census.
14
Author's calculations with 2012 census.
15
After Antofagasta, in the main copper mining region in Chile.
16
Author's calculations with 2013 Casen survey.
17
Source: Casen survey 2013.
stable gure since 2006 and a considerable improvement in comparison
to 1987, when poverty rates attained 49% (Larrain, 1990). Wealth is un-
evenly distributed among the 37 municipalities of Greater Santiago, the
richest having an average income more than 7 times above the poorest
one, and contrasting poverty rates of 0.3% and 21.8%. Redistribution
among municipalities is relatively weak, so these income differences
are associated with important inequalities in the quality of public ser-
vices and spaces.
In Chile, income inequality is closely correlated with educational
levels, both individually and spatially (Agostini, Hojman, Romn, &
Valenzuela, 2016). Greater Santiago has a qualied workforce, with
28% of the active population having a university degree, but average in-
comes markedly differ by qualication and gender (Table 1). This work-
force and income structure may be convenient for enterprises,
simultaneously providing high skills and inexpensive support services.
Above all, Greater Santiago offers a good economic environment and in-
frastructure, and has been considered the best city for doing business in
Latin America.18
Compared to other Chilean regions, the Metropolitan Region19 is
highly specialized in nancial and business services, has a lower share
of industrial activities and a minimal contribution of the primary sector
(Fig. 10). This economic structure results from deindustrialization and
globalization processes in Greater Santiago and reects the concentra-
tion of command functions in this metropolis, including the headquar-
ters of nancial institutions, of multiregional extractive enterprises
and branch ofces of multinational companies. Thus, Greater Santiago
has 35% of Chile's population but receives 49% of the national workers'
income.20 This concentration of wealth is accompanied by the develop-
ment of tourism, a diversication of cultural activities and has allowed
to develop ne urban amenities in select areas, as will be described
below.
5.3. Tourism, amenities, urban environment and air pollution
Although Greater Santiago has a lower touristic importance than
other Latin American cities - notably Lima, Mexico City, Sao Paulo and
Buenos Aires, it is the principal destination in Chile and also the main
passing port towards other Chilean regions. With 137 hotels and
25,000 beds it has 16% of the national lodging capacity, but it receives
60% of overnight international visitors and only 15% of national tourists,
with room tariffs that almost triple the average of the other regions.21
While Chilean tourism is mainly driven by natural attractions, Greater
Santiago has a more diversied offer, being close to ski centers and
not far from central beaches, also having urban attractions such as
parks, museums, shows, restaurants and nightlife. Hotels and amenities
are highly concentrated in downtown Santiago and around the new Fi-
nancial District (Fig. 11).
However, restaurants and cinemas are also present in peripheral
sectors, often in association with shopping malls, near highways or sub-
way lines. Greater Santiago's inhabitants spend 13% more in restaurants
and bars than other Chileans,22 and they go to the movies almost as
often as all other cultural activities combined, having a low attendance
to museums, theaters, music, dancing and other performances.23 This
shows that the central concentration of amenities and nightlife is not
necessarily representative of average lifestyles in this city.
18
Excluding Miami, USA. Source: America Economia Intelligence 2014, 2015 & 2016.
http://www.americaeconomia.com/rankings consulted 4.10.16.
19
Greater Santiago is within the Metropolitan Region, representing 88% of its population
and 94% of its total income. Sectoral GDP statistics are only available at the regional level.
20
Author's calculations with Census 2012 and Casen 2013 data.
21
Source: National Survey of Touristic establishments, 2013.
22
Author's calculations with the Family Budgets Survey 2012.
23
Source: Cultural Consumption Survey 2012.
 M. Garreton Cities 65 (2017) 3250 41

Fig. 9. Residential sprawl and jobs concentration in Greater Santiago.

Sources: 2012 census, 2012 Greater Santiago's origin and destination survey.
42 M. Garreton Cities 65 (2017) 3250
Table 1
Average income by gender and qualication in Greater Santiago.
Sources: 2012 Census, 2013 Casen survey.
Unqualied University degree
Female Income 438 USD 1480 USD
N workers 838,938 276,778
Male Income 600 USD 2333 USD
N workers 1,186,879 329,909
Greater Santiago is situated in a spectacular landscape, around the
valley of the Mapocho, surrounded by the Andes Mountains by the
east, the coastal mountain range of Chile by the west and several hills
in between. The latter are restricted areas for building and have a
huge potential as urban parks, as exemplied by the Metropolitan
Park (Fig. 13), but most of them have not been properly developed yet
(Fig. 14). Green areas are unevenly distributed throughout Greater San-
tiago, mainly due to the location of the huge Metropolitan Park and
most urban parks in high income sectors (Figs. 11 and 13). In downtown
Santiago, green areas are well tended and have very high attendance, in-
cluding the Forestry Park (Fig. 12) - an attractive green corridor along-
side the Mapocho River - the Quinta Normal and OHiggins parks,
which were built in the 19th century. More recently, important urban
parks have been developed towards the south of this city, without
attaining the coverage that is observed in the aforementioned sectors,
while the northwest quadrant has a decit of green areas (Fig. 11).
The mountainous surroundings of Greater Santiago reduce natural
ventilation and foster the accumulation of smog, which is particularly
severe during winter, due to a thermal inversion effect.24 It is estimated
that air pollution - almost equally produced by vehicles, industries and
domestic heating - causes 1500 annual deaths in Greater Santiago
(MMA, 2011). Air pollution has signicantly improved from an annual
average of 69 g/m3 in 1989 to 29 g/m3 in 2014, thanks to successive
regulations of transport, industrial and domestic emissions, albeit it is
still above the Chilean legal norm of 20 g/m3 and over the WHO recom-
mendation of 10 g/m3. This situation is not uncommon in developing
countries, Greater Santiago is the 581th most polluted region in the
world25 and it has better air quality than 6 other Chilean cities. Howev-
er, due to the location of pollution sources, topographic and atmospher-
ic conditions, air pollution affects more severely downtown Santiago
and the lowest areas of this basin, which correspond to low-income mu-
nicipalities at the north, west and southern margins of the metropolis.
5.4. Segregation and insecurity
Greater Santiago is a highly segregated metropolis, due to historic res-
idential patterns, the eradications and urban deregulation during
Pinochet's dictatorship and recent market-driven processes (Hidalgo,
2007; Sabatini, 2000; Sabatini & Brain, 2008). Considering segregation
measures in seven Latin American cities and one city in USA, calculated
with comparable methodologies (Roberts & Wilson, 2009), Greater Santi-
ago shows the second most uneven distribution - as measured by the dis-
similarity index - of household heads with low education (Table 2). This is
just below Austin, which is the third most segregated metropolitan area
in the USA (Florida & Mellander, 2015). However, regarding two other
measures of segregation - isolation as the probability of contact with
same-group individuals and Moran's autocorrelation as a measure of a
group's spatial clustering - Greater Santiago shows average levels
among a highly segregated sample (Table 2; Roberts & Wilson, 2009).
24
Warm air, driven by the prevailing winds from the Pacic Ocean is elevated at its pas-
sage over the coastal range and inverts the normally decreasing temperature gradient
from the surface to higher layers, thus preventing convection and dilution of polluted air
from the ground.
25
According to WHO's Global Urban Ambient Air Pollution database, 2016, which con-
siders 2971 cities.
At a metropolitan scale, Greater Santiago shows a clear pattern of
segregation between high and low education clusters - dened by a sig-
nicant spatial autocorrelation26 of household heads' average education
years at block level - which closely matches the distribution of socioeco-
nomic groups (Figs. 8 and 17). High-education clusters span from Santi-
ago downtown towards the northeastern quadrant and have advanced
recently towards the south through the Andean foothills and in periph-
eral areas with good connectivity through highways or subway lines
(Fig. 17). These sectors have concentrated the development of private
and public services since 1992 (Fig. 8), contain the main employment
centers (Fig. 9) and most of the amenities and touristic attractions
(Fig. 11). Low-education clusters are distributed near Americo Vespucio
beltway in the northwest and beyond it towards the south (Fig. 17).
With the exception of subsidiary public housing, low quality public
spaces (Fig. 16) and a few urban parks (Fig. 11), these sectors have
not beneted from mayor urban investments during the last 25 years.
Furthermore, Greater Santiago shows two distinct patterns of urban
violence hotspots (Fig. 17), which are identied by a signicant spatial
autocorrelation27 of a score that combines different types of crime
reports.28 This score is built by homogeneity analysis29 and it mainly
represents drug offenses, followed by arms use and homicides, offenses
against the person and in a much lesser degree, offenses against proper-
ty. This kind of urban violence is concentrated in sectors of intense peo-
ple circulation - notably in downtown Santiago and its surroundings -
but it is also found in peripheral areas, where it is entirely contained
in low-education clusters (Fig. 17).
In sum, Greater Santiago is partly a developed city, with competitive
economic activities, good infrastructure, attractive amenities, public
spaces and landscapes, but also has important underdeveloped areas,
with poverty concentration, violence and disinvestment. These deep
socio-spatial inequalities are manifested in an intricate geography of seg-
regated areas (Fig. 17) that share common disadvantages such as low ac-
cessibility to jobs and amenities, high levels of urban violence and a poor
quality of public services (Fernndez et al., 2016). These handicaps are in-
terrelated and should be addressed with comprehensive territorial poli-
cies, raising a major challenge of metropolitan governance.
5.5. The challenge of metropolitan governance
Greater Santiago is governed by an array of national and local public
authorities, weakly coordinated. On one hand, several ministries - main-
ly MOP, MINVU and MTT - directly command planning decisions,
prevailing over local regulations when conicts arise (Landon, 2013;
Zunino, 2006). However, as Transantiago implementation showed,
they are reciprocally uncooperative, even if they report directly to the
President. On the other hand, 37 elected mayors represent the local in-
terests of functionally and environmentally interdependent municipal-
ities, without direct incentives30 to collaborate on common issues,
being legally authorized to do so only since 2011.31 In Chile, municipal-
ities have a limited nancial capacity, managing only 14% of public
spending, equivalent to 3.3% of national GDP.32 In Greater Santiago,
this capacity is very unequally distributed, as municipalities' autono-
mous budgets range from 1040 to 24 USD per inhabitant,33 in direct re-
lationship to residents' incomes. Including the common municipalities
26
Calculated by the local Moran statistic in ArcMap software, with 99% statistical
signicance.
27
Calculated with the Getis-Ord Gi statistic in ArcMap software, with 99% statistical
signicance.
28
From 2012 cadaster of the Crime Prevention Secretary of the Interior Ministry.
29
Performed with the function homals, from the homonymous package, in R software.
30
Such as special subsidies or extended capacities, as is observed in many decentralized
systems.
31
By the law for municipal organization and associations, n 20,527.
32
Source: Budget Directorate (DIPRES), 2014.
33
Source: National System of Municipal information (SINIM), 2014.
 M. Garreton Cities 65 (2017) 3250
Fig. 10. Metropolitan Region's GDP composition compared to other Chilean regions.
Source: Chile's Central Bank regional statistics, 2004. Note: Managing services comprise
public administration, nancial and business services. General services include personal
services, commerce and tourism. Basic services encompass housing, transport, com-
munications, electricity, water and gas. Industry comprises manufacturing and building.
Primary sector includes mining, shing, forestry, livestock and agriculture.
fund - the main redistributive instrument at this level, this difference is
slightly attenuated, from 1054 to 127 USD, a huge budgetary inequality
that underlines the weakness of territorial redistribution.
Chile is a highly centralized country and the only one in South
America that does not have elected regional authorities, instead having
Intendentes that are designated by the President. Although their scope of
action is the regional territory, their political subservience undermines
their autonomy to oppose national policies or ministerial projects in
case of conict with local interests. Moreover, regional governments
have no specic sectoral authority, so their initiatives tend to be focused
towards issues that are neglected by other actors. For example, the most
visible line of action of the actual Metropolitan Region Government is
the development of inter-municipal bikeways, which certainly have a
high symbolic value, but this mode concerns only 3.3% of total trips in
the city (Fig. 18). Nevertheless, regional governments have an impor-
tant potential as coordinators, because they must act through partner-
ships with other public agencies or private actors. To this end, they
channel funds through diverse collaborative programs and contracts,
which represent 10% of public investment in the Metropolitan Region.
This capacity could be boosted in the near term, as a constitutional
reform approved in October 2016 will allow the election of regional
governors in 2017 or 2020,34 with increased budgets and administrative
authority. It is yet unclear to what extent regional governments will be
reinforced, but they will certainly face high expectations and the dif-
cult task of coordinating the action of powerful ministries within a co-
herent and sustainable vision of regional planning. A strong territorial,
intersectoral metropolitan authority is sorely needed in order to resolve
structural unbalances that deeply affect quality of life in Greater Santia-
go. First, in order to compensate for severe socio-spatial inequalities in
multiple dimensions, concerning segregation, violence, disinvestment
and quality of public services and spaces. Second, by planning long-
term strategies to cope with trafc congestion and reducing the asym-
metry between job concentration and residential sprawl. And in gener-
al, by shifting from an uncoordinated pro-entrepreneurial mode of
public action (Lpez-Morales et al., 2012; Silva, 2011), towards socially
inclusive and sustainable regional planning. As mentioned before, there
has been a renewed interest about redistributive and participatory pol-
icies in the last decade, with relevant local and symbolic impacts, but
structural reforms would be necessary in order to compensate the
34
Depending on the approval of related laws for the decentralization of sectoral author-
ities and budgets.
43
heavy weight of widespread neoliberal policies and their accumulated
impact in urban space over forty years.
6. Centralized power, urban policies and outcomes in Greater
Santiago
Since the early days of the Chilean Republic, power has been central-
ized and the socio-spatial closeness of political and economic elites has
been reinforced in Santiago, which progressively acquired a dominant
position in the country, as a command center of an extractive economy
that concentrated the early development of industry, attracted national
migration and benetted from the construction of regional and urban
infrastructures more than any other city (Geisse, 1978; Fig. 19). This
concentration of power and resources in the capital was followed by
the consolidation of a ministerial bureaucracy with strong planning ca-
pacities and state-of-the-art technical competences, due to an openness
to foreign knowledge that began with the immigration of European en-
gineers in the early years of MOP (Parada, 2011). Engineering acquired a
growing inuence over political decisions since the government of Gen-
eral Ibaez in 1927, and high-skilled public experts became another
concentrated elite that emerged within the powerful ministries of the
developmental state (Zrari, 2010).
During Pinochet's dictatorship, neoliberal reforms were possible by
the combination of an authoritarian regime, a generation of inuential
economists returning from postgraduate studies in Chicago and the ren-
ovation of an elite of highly skilled public servants (Garate, 2012; Zrari,
2010). Albeit the economic capacity of the State was maimed by the pri-
vatization of public enterprises and natural resources, and by drastic re-
ductions of public employment, the central government maintained its
centralized regulatory authority while reorienting its role towards pro-
market policies. Notably, as power was concentrated under an authori-
tarian regime, the permeability between the political, economic and
technocratic elites was reinforced (Monckeberg, 2001; Zrari, 2010).
The reforms that followed the adoption of Neoliberal Theory as of-
cial policy in 1977 and the institutionalization of these principles in a
Subsidiary State model in the 1980 Constitution were complemented
with the development of econometric procedures for ex-ante and ex-
post evaluation of public investment and spending (Fig. 19). Thus,
major policy shifts such as the pro-market National Policy for Urban De-
velopment in 1979 and the complete deregulation of urban transport in
1981, were coupled to a tight control over public nances. The introduc-
tion of econometric evaluation instruments for public self-regulation
provided a framework that could be adjusted to different sectoral spec-
ications and was gradually generalized, with positive and negative
outcomes. On one hand, the immediate efciency of public spending
was increased and public funds misuse was largely prevented, while
the early adoption of sophisticated econometric regulations - before
the global expansion of Neoliberal policies in the 1980s -, situated
Chile in a pivotal position between industrialized and underdeveloped
countries (Harvey, 2005; Peck et al., 2009). On the other hand, this re-
ductionist approach neglected the reciprocal effects and diverging spa-
tial outcomes of different sectoral policies, notably transportation and
equipment disinvestment around massive social housing develop-
ments, and congestion in highly-demanded areas.
Simultaneously, socio-spatial segregation in Greater Santiago was
intensied by the redenition of municipalities as socially homoge-
neous entities, which simplied the administration of subsidiary social
policies (Hardy, 1989), but started a vicious circle of accumulation of
territorial disadvantages, co-produced by the concentration of poor
households and the consequent weakness of municipal nances. More-
over, different subsidiary policies - notably housing, health and educa-
tion - were focused in the same areas and provided low-quality
services, while private investment in afuent neighborhoods sharpened
urban inequalities. This kind of accumulative and multidimensional dis-
advantages could not be adequately quantied with a system of sectoral
econometric evaluation of public policies.
44 M. Garreton Cities 65 (2017) 3250

Fig. 11. Tourism and amenities in Greater Santiago.

Sources: National Statistics Institute, Tourism National Service, Museums and Libraries Directorate.
 M. Garreton Cities 65 (2017) 3250 45

Fig. 14. Renca municipality and its isolated hill.

Source: Author. Note: Renca is a low-income municipality in the
northwest of Greater Santiago. It has the third biggest isolated hill -
high-slope areas where construction is forbidden - in the metropolis,
which could become an urban park with a similar magnitude to the
Metropolitan Park (Fig. 11). However, due to lack of funding and
adequate planning, it is unsecure, unkempt and only a fraction of its
area is accessible.

Fig. 12. Contemporary arts Museum in Forestry Park.

Subsidiary policies and sectoral regulations were crucial for manag-
Source: Author. Note: The Forestry Park follows the Mapocho river's
southern bank, connecting downtown Santiago with similar green ing a reduced State and boosting economic growth during the 1990s,
corridors to the east and west. but maintained high inequality levels that became more visible as dis-
advantaged neighborhoods were left behind by rapidly developing dis-
tricts. The objective of focusing scarce public resources in the most
Since 1990, successive democratic governments in Chile confronted urgent social needs has lost traction as the Chilean society has become
the most critical social needs and lack of infrastructures with subven- richer and sharp inequalities are less tolerated. While poverty concen-
tions and prot guarantees to private enterprises that executed sectoral tration was a perverse consequence of urban policies during the dicta-
public policies. Key ministries for urban development - MOP, MINVU torship, the negative social consequences of poorly regulated urban
and MTT kept on reducing their planning and operational capabilities development have become a main concern in a more afuent and dem-
and specialized in the allocation of subventions or franchise tenders to ocratic society. Fundamental tasks such as reducing absolute poverty
private providers of public goods (Silva, 2011; Zunino, 2006). As noted
before, the regulation of these public policy markets relied heavily in
econometric social utility evaluations - which were institutionalized
by the National System of Public Investments (SNIP), and became pro-
gressively dependent on private consultants and academic experts for
policy design and projects execution. In a context of high professional
mobility between public agencies and private enterprises (Briones,
2009; Zrari, 2010), this technocratic form of regulation gave a consider-
able inuence to private investors over the design of public policies
(Lpez-Morales et al., 2012; Silva, 2011). Market-oriented planning,
weakly regulated by sectoral evaluations, stimulated investment in cen-
tral and afuent areas, allowed housing developments in suburban
areas with insufcient compensation of urbanization costs and promot-
ed the construction of urban highways, without accounting for the neg-
ative externalities of these interventions, such as gentrication,
congestion, sprawl and local impact on vulnerable populations (Fig. 19).

Fig. 13. Metropolitan and Sculpture's parks.
Source: Author. Note: The Sculpture's Park is built over Costanera
Norte, a franchised urban highway that runs on the northern bank
of the Mapocho River. The hills on the background are part of the
Metropolitan Park, spanning from downtown Santiago towards the
lower Andes mountains.
Fig. 15. High and low income housing in Greater Santiago.
Source: Author. Note: Picture A shows single family homes in the exclusive
Lo Curro hillsides, picture B is taken in Cerro Navia municipality, showing
informal slums and 4-storey blocks of social housing in the background.
Both views were taken from the Mapocho River, their respective locations
are referenced in Fig. 17.
46 M. Garreton Cities 65 (2017) 3250

Table 2 that are similar to certain cases and different to others, in a combination
Segregation indexes in selected Latin American cities. that is unique to this city.
Source: Roberts & Wilson, 2009.
In terms of its neoliberalization trajectory, Chile has anticipated or
Dissimilarity Isolation Global Moran been aligned with the developed world. First, pioneering the dismantle-
Santiago (Chile) 0.41 0.41 0.69 ment of the State and the privatization of its enterprises, in the rollback
Buenos Aires (Argentina) 0.27 0.50 0.78 form of early neoliberalism (Peck & Tickell, 2002; Peck et al., 2009). Sec-
Lima (Peru) 0.33 0.70 0.56 ond, since the recovery of democracy in 1990, new forms of public-
Mexico City 0.15 0.25 0.67
private arrangements were developed under the framework of the Sub-
Montevideo (Uruguay) 0.37 0.38 0.79
Sao Paulo (Brazil) 0.28 0.58 0.74 sidiary State, in a form of rollout neoliberalism (Op. cit.) that created
Campinas (Brazil) 0.26 0.58 protable markets around social policies. Third, a process of state mod-
Austin (USA) 0.42 0.21 0.61 ernization began with this century, increasing social spending but abdi-
Note: Most segregation indexes were calculated for data circa year 2000, with the excep- cating concrete planning capacities in favor of more liquid forms of
tion of Lima, for 1992. subsidies and a growing reliance on private experts for policy design,
thus developing nancialized ways of rollout neoliberalism.
have been successfully addressed by subsidiary policies, but more com- Income inequalities in Chile are similar to those that are observed in
plex challenges emerge, such as promoting sustainable urban develop- other extractive economies of Latin America and Africa, but Greater San-
ment, providing well-located social housing, controlling sprawl and tiago shows a higher degree of formality - similar to the developed
congestion. However, as the investment capacity of private capitals world -, in terms of property rights, housing settlements, economic ac-
has increased, public agencies have failed to develop effective regula- tivities and early modernization of technical regulations. This congura-
tions for a better intersectoral coordination and a fair redistribution of tion allowed the testing of new policies since Pinochet's dictatorship
the benets of urban development. with the support of international institutions (Fig. 19), notably focalized
Since 2006, the resentment of unequal development has fueled civil subsidies to housing demand and econometric evaluation systems for
contestation, while new public policies are responding with a continued public projects, which have been exported to Latin America and in a
increase of social spending and paradigm shifts in particular cases. No- lesser degree to Africa (Ferguson & Navarrete, 2003; Gilbert, 2002).
tably, the Quiero mi Barrio program has been focused on neighborhood Conversely, this has led to adopt globally circulating policies such as
communities instead of individual housing, with participatory planning bus rapid transit (BRT) and zero tolerance security with insufcient crit-
and limited intervention of private partners. Likewise, the most recent ical adjustment to local realities, and disappointing results.
National Policy for Urban Development (2014) has an unprecedented The Neoliberalization of Chile was implemented very rapidly and
emphasis on spatial justice and sustainability, but this has not been im- vertically, from the imposition of an ad hoc Constitution in 1980 to the
plemented in laws nor effective regulations yet. Likewise, imminent de- radical reformulation of public action, towards serving market process-
centralization reforms could help to address territorial inequalities with es and only intervening where private providers were absent. To my
regional and local policy adjustments including relevant civil participa- knowledge, this particular form of a Subsidiary State has not been so
tion (Fainstein, 2010). deeply institutionalized elsewhere, with the closest example being the
Peruvian Constitution of 1993, which had a much lesser and more grad-
ual impact (Acosta, 2003). In combination with a historical strong cen-
7. Conclusion: Greater Santiago's neoliberal uniqueness tralization of political and economic power, this allowed the
implementation of massive urban policies, such as eradications, social
In the previous sections, the historical and institutional evolution housing developments, high-rise densication, urban highways and
that has shaped Greater Santiago and the contrasting living conditions public transport restructuration, with little or no consultation with
in this metropolis have been discussed, developing a case study that is local governments and citizens, even after the recovery of democracy.
certainly unique, as any city could be. However, in terms of At a smaller scale, this is akin to Asian mega-developments, which can
neoliberalization processes that are globally replicated (Peck et al., be even more massive and authoritarian (Lees, Shin, & Lpez-Morales,
2009), it is worthwhile to situate this case in a larger context, in order 2016), but offers a sharp contrast to urban neoliberalism in developed
to understand its particular position in the evolution of neoliberalism. democracies, which has evolved more gradually and in a closer relation-
From this perspective, the denition of Greater Santiago's uniqueness ship with local authorities. However, the relative economic weakness of
is more complicated, but can be understood as a set of characteristics the Chilean State gives a stronger inuence to private counterparts here
than in Asian developmental states, increasing the dependence of public
regulators and the inuence of investors in the design of centralized
public policies.
In Chile, the industrial sector never attained the importance and dy-
namic that boosted the industrialized-developed economies, and the
achievements of the developmental state in this respect were largely
dismantled during Pinochet's dictatorship. Thus, deindustrialization
has not been a main driver of urban neoliberal restructuration, and
the lack of a strong industrial middle class sharpens the socioeconomic
differences between educated professionals and unspecialized service
employees (Table 1). Thus, income and education inequalities are pow-
erful drivers of residential segregation in Greater Santiago, which at-
tains similar levels to the most segregated North American cities
(Roberts & Wilson, 2009), even if race distinctions are absent.
The Chilean economy has an extractive basis and a low capacity to
Fig. 16. Sports ground in a social housing development. add value to exported natural resources. Instead, there exists a close in-
Source: Author. Note: This picture was taken in Renca municipality, tegration between natural resources exploitation and nancial activi-
showing an unkempt sports eld - facilities that are often invaded by
criminal gangs - in a social housing development. As housing units are
ties, notably because the wealthiest families of Chile simultaneously
small, self-built enlargements are frequent, increasing built density with own banks, mines, forests and/or shing rights, while they are principal
poor acoustic and thermal isolation. nancers of political activity across the political spectrum (Matamala,
 M. Garreton Cities 65 (2017) 3250 47

Fig. 17. Segregation and urban violence in Greater Santiago.

Sources: Ministry of Interior's cadaster of crime reports, 2012; Census 2012; SII buildings cadaster. Note: Violence hotspots
and clusters of high and low education are dened with a 99% statistical signicance, respectively using Getis-Ord Gi and
local Moran statistics. The locations of pictures in Fig. 15 are referenced here as 15.a and 15.b.

2015). Most of these companies' headquarters are located in or near the nancial placements in Chile (Daher, 2016), thus creating a direct capi-
new nancial district in Greater Santiago (Orellana, 2009; Fig. 17). Nota- tal circuit from extractive accumulation, to nancial rents and to urban
bly, housing development and mortgages represent almost half of property rents, bypassing the circulation of capital through a productive
48 M. Garreton Cities 65 (2017) 3250

and global capitals in high-rise buildings and urban infrastructure. In

Fig. 18. Highways and biking in the new nancial district.
Source: Author. Note: biking is an expanding transport mode (2.4% in
2001 and 3.3% in 2012), but this increase has mainly concerned high
income groups that are able to pay for homes in areas that allow for
relatively short trips, due to high densities of jobs and amenities.
sector, which is characteristic of industrialized economies (Lees et al.,
2016). Taken together, these circuits of concentrated wealth and their
inuence over centralized regulators, have an extraordinary power to
reshape urban structure, reinvesting utilities from extractive activities
Latin America there is no other big metropolis that has undergone
such a radical and fast urban restructuration as has been done in Greater
Santiago by the almost simultaneous processes of: a massive national
policy of peripheral social housing, the repopulation of downtown San-
tiago, creating a new main nancial district in the core of the high-
income cone of the metropolis, the extensive development of urban
highways and a public transport revolution. Asian mega-
developments might be more massive, but the displacement in hierar-
chy of a capital nancial district by a new one in less than twenty
years is, to my knowledge, unique or very rare.
In sum, actually existing neoliberalism in Chile, and particularly in
Greater Santiago, is characterized by income inequalities that are sharp-
ened by the specialization in extractive and globalized nancial activi-
ties (in the absence of a strong industrial sector), by the concentration
of the property of these companies and the closeness of their headquar-
ters in the metropolitan core, by the reinvestment of nancial leverage
in high-rise buildings and private development of infrastructures; and
by the disinvestment in subsidiary spaces created by social housing pol-
icies, with low quality education and health, aficted by poverty and
chronic urban violence (Fernndez et al., 2016; Fig. 17). This socio-
spatial divergence has not been adequately regulated by urban policies
that have been shaped under the constitutional constraints of an eco-
nomically weak Subsidiary State, with poorly coordinated sectoral

Fig. 19. Institutional evolution and outcomes in Greater Santiago.

Source: Author's synthesis based on previous sections.
 M. Garreton Cities 65 (2017) 3250
public institutions, specialized in the monetary regulation of subsidies
while progressively relying on private and academic expertise for the
design and execution of public policies.
This critical analysis must be balanced by the important social
achievements that have been accomplished by public policies and eco-
nomic growth since the recovery of democracy notably poverty reduc-
tion -, and by the contribution of private investment for the
development of housing, urban and regional infrastructure in Greater
Santiago. However, as Chilean society evolves, socio-spatial inequalities
are a less-tolerated and widespread concern. Emerging policies are ad-
vancing towards more inclusive and participative forms of public action,
under the pressure of civil demands for a fairer distribution of wealth,
public goods and decision power. At the metropolitan level, the imple-
mentation of the rst elected regional governments will be crucial for
a sorely needed reinforcement of urban planning, with a better coordi-
nation of sectoral policies and more attention to socio-spatial justice
and sustainability.
Acknowledgements
This work was supported by the Centre for Social Conict and Cohe-
sion Studies (COES, CONICYT/FONDAP/15130009). I sincerely appreci-
ate the commitment and precious insights of the editor and two
anonymous reviewers, which allowed to substantially improve this ar-
ticle. I'm especially grateful to Luis Valenzuela and all of the CIT team,
for giving me the space and support to develop this research.
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