Decentralization and Development of Cities in Chile: The Case of Valparaiso

Situated at one of the far-end of the world, as it may be viewed from the Triad countries (Northern America, Western Europe and Japan) Chile performs really well in the world of globalization in sharp contrast with all its neighbors. At first glance this success story may appear as the first Chilean paradox: the highly centralized political and administrative system does not seem to have hampered the economic development although it is generally considered that decentralization is an advisable way to enhance economic performance. In that context one could expect Chilean cities to be success stories as well, which is not the case at least for the second largest city: Valparaiso. That is the second Chilean paradox. This paper tries to consider these two entwined paradoxes and to suggest that a better and more decentralized framework could contribute to produce stronger municipalities and stronger cities without hampering the Chilean macroeconomic success story.