This chapter discusses the role of structural adjustment, stabilization, and policy reform on domestic and international finance. Structural adjustment programs generally start with a conventional stabilization program, intended to restore the viability of the current account and the budget, but...

After a review of the macroeconomic disequilibrium in Chile before the reform initiative, the author interprets the adjustments covering two distinct periods: 1973-76, when policy was based on a closed-economy view, and 1977-82, when measures were increasingly guided by an open-economy model. It...