Since 2020, inequality has increased again both globally and regionally. The gap between the global North and South has grown for the first time in 25 years, and this extreme inequality has been consolidated as our “new normal”. However, this “new normal” is not new in Latin America, the most unequal region in the world, and even less so in Chile, one of the most unequal countries in this region. What, then, can we learn from inequality in Chile?

Although the increase in inequality is a multifactorial phenomenon, one contributing factor is the progressive privatization of public services such as education, health, and pensions. In the 1980s, Chile adopted this approach, assuming that the market was more efficient than the state in distributing these services. Hence, in education, this led to the privatization of both the provision and financing of the school and higher education systems.

However, these decades have shown that market consolidation has failed on its own terms, for although inequality in education has not increased, neither has it been reduced. Indeed, numerous studies, such as that of Danilo Kuzmanic Reyes, show that privatization drives new educational inequalities.

Consequences of the privatization of education

While enrollment in higher education has increased massively thanks to the creation of private institutions, tuition and fees have been introduced throughout the system. Thus, public spending on education remained relatively stable while the sector’s financing was based on student loans and scholarships.

The social demonstrations (particularly students) of 2006 and 2011 in the streets of Chile promoted policies to regulate the — until then called — “higher education market”, with the aim of prohibiting profit-making and promoting equity in access and quality of higher education. To this end, the strategy chosen was to weaken the economic barriers to entry, assuming that merit and personal effort would reduce the gaps during the transition to and exit from higher education.

The impact of these measures has transformed Chilean higher education into a massive and diverse system, where opportunities to access this educational level have increased across the board, integrating historically excluded sectors (such as women, rural population and indigenous peoples). However, this has not translated into a decline in inequality.

On the one hand, loans and scholarships, and the recent policy of progressive free education have reduced the effect of economic resources (e.g., household income) both in general access and in admission to less selective institutions. On the other hand, the effect of socio-cultural resources of origin (e.g.: parents’ educational level) has decreased to a lesser extent in general access, remaining unchanged in admission to the most selective institutions such as the universities of the Rectors’ Council.

What has been the result?

These changes have led to a decrease in quantitative inequality in higher education, but an increase in socioeconomic segmentation among tertiary institutions. Furthermore, there has been an increase in qualitative inequalities in higher education, highlighting the distinction between entry, transit and exit barriers, together with the importance of symbolic and psychoemotional gaps in the reproduction of educational inequality.

The combination of these factors yields a scenario of growing qualitative inequality in Chilean higher education, with a pattern similar to that described in the Oxfam Inequality Inc. 2024 report. A “top-driven” pattern, where a small minority concentrates most of the wealth, income, power and, indeed, educational and employment opportunities. This pattern has been identified in Chile and other Latin American educational systems, despite being originally a particularity of the Chilean case regarding the reduced possibilities of social mobility. Hence, the term “unequal but fluid” was coined.

In Chile, the most prestigious and selective tertiary institutions remain almost exclusively accessible to the elite, setting them apart from the rest of the less prestigious and selective institutions. This polarization of educational opportunities allows access or educational mobility primarily within certain institutions or programs, resulting in limited or short-distance mobility. Although the massification of higher education has broadened the spectrum of possible opportunities, it has not succeeded in expanding the spectrum of real opportunities.

What can we learn from this example?

Firstly, although the debate on inequality is eminently economic in nature, the case of the privatization of Chilean education shows that it is not possible to reduce inequality through economic policies alone. It is necessary to consider other spheres of inequality reproduction: the inequitable distribution of income or wealth has a correlate on our perception of inequality, our opportunities, and life expectations, among other aspects. In fact, the relationship between “real inequality” and “perceived inequality” has been defined as “broken”, “weak”, “transitory”, “unstable” and “culturally situated”.

Secondly, although the debate on inequality addresses structural elements by questioning the role of the state or the market, its symbolic impact cannot be ignored. If the structure of opportunities is polarized in an unequal but fluid pattern, it is necessary to rethink how the educational system and labor market create expectations of social mobility that do not translate into real opportunities. For example, the growing conflict in Chile regarding changes in the higher education financing system, such as the proposal to cancel student debts, illustrates this issue. For some, this is a reasonable and fair measure; for others, it is a policy of electoral populism. We will have to wait and see what happens with the government’s proposal in September 2024

Thirdly, the debate on inequality is inseparable from political discussions about “politics” and “public policy.” The concentration of wealth and opportunities implies that power is also concentrated in a minority. Therefore, it is essential to consider the conditions needed for dialogue to promote change: specifically, how to engage in political dialogue to implement change through public policy. Reducing inequality in education or any other area requires, above all, reducing inequality in politics and public policies.

_{*Translated by Janaína Ruviaro da Silva from the original in Spanish.}