IESET.
Hypotheses·growth·chile_vs_venezuela_divergence_1999_2023

Chile and Venezuela began the 1999-2023 window at broadly comparable GDP per capita (PPP, constant international dollars).

Over the subsequent 24 years Chile continued its institutional-market policy trajectory (fiscal rule, central-bank independence, export-diversified commodity model, secure property rights, trade openness) while Venezuela ran the Chavismo programme (FX controls, price controls, PDVSA politicisation, large-scale nationalisations, monetary-fiscal fusion). By 2023 the log GDP-per-capita-PPP gap between Chile and Venezuela exceeds 1.2 log-points (~230% relative). The bilateral comparison is one of the cleanest natural experiments in Latin American development economics because both economies are commodity-dependent, Spanish-colonial-legacy Latin American states that diverged on policy content, not on initial conditions.

SUPPORTEDengine/runs/chile_vs_venezuela_divergence_1999_2023

SUPPORTED — 2023 log-gap (CHL−VEN) +2.30 (>=1.20). Cumulative growth gap 1999→2023 +1.50 log-points (>=0.60). Chile annualised +2.33%/yr; Venezuela -3.93%/yr.

confidence cueThis is a clear pass for the claim as written. It still applies only to this sample, period, and method.

policy briefNeeds review

In ordinary language

Over a long period, do more market-oriented institutions translate into higher income or productivity, once the comparison looks beyond a single success story?

plain answer

The data clearly moved in the predicted direction. 2023 log-gap (CHL−VEN) +2.30 (>=1.20).

why it matters

Growth claims can look convincing in single success stories. This test asks whether the pattern survives a broader comparison.

how the test works

It compares 2 country or place units from 1999 to 2023, using a descriptive design.

what was measured
What we checked
  • Log income pc cost-of-living adjusted
what this does not prove

A single test is not the whole truth. It narrows the claim under a specific sample, time period, and method. Strong policy conclusions need the pattern to survive nearby tests, alternative data, and serious objections.

verification

2 input datasets, 0 unresolved missing series, provenance status: partial provenance.

Results

engine/runs/chile_vs_venezuela_divergence_1999_2023
descriptive sketch · model not yet run
Loading chart…

Who has skin in the game — schools predicting on this

17 schools list this hypothesis as a test of their position. The chips below are school-level scoreboard outcomes, not a second hypothesis verdict.

hypothesis verdict vs scoreboard outcome

The banner verdict judges this hypothesis as written. The scoreboard asks whether each school's polarity-corrected prediction was right. Raw status is not a school win: SUPPORTED supports schools that needed SUPPORTED, but refutes schools that needed REFUTED.

Austrian Business Cycle Theory (ABCT)wins if SUPPORTEDschool supportedChicago School Monetarismwins if SUPPORTEDschool supportedClassical Liberalwins if SUPPORTEDschool supportedDegrowth / Ecological Macroeconomicswins if REFUTEDschool refutedDemocratic Socialism (Bernsteinian revisionism + modern)wins if REFUTEDschool refutedStructuralist / Developmentalistwins if MIXEDpartial/no-callEco-Socialism / Red-Greenwins if REFUTEDschool refutedEmpirical Pragmatist (the framework's house position)wins if MIXEDpartial/no-callNew Institutional Economicswins if MIXEDpartial/no-callMarket Socialism (Lange-Lerner tradition)wins if REFUTEDschool refutedMarxian Political Economywins if REFUTEDschool refutedMarxism-Leninism (central-planning implementation)wins if REFUTEDschool refutedModern Monetary Theorywins if REFUTEDschool refutedNew Keynesian (mainstream synthesis)wins if MIXEDpartial/no-callOrdoliberalism (Freiburg School)wins if SUPPORTEDschool supportedPost-Keynesianwins if REFUTEDschool refutedSocial Democraticwins if REFUTEDschool refuted

Pre-registration

pre-registered
first-spec commit 4c8ce8e · 2026-07-18T22:11:21Z

Chile and Venezuela began the 1999-2023 window at broadly comparable GDP per capita (PPP, constant international dollars). Over the subsequent 24 years Chile continued its institutional-market policy trajectory (fiscal rule, central-bank independence, export-diversified commodity model, secure property rights, trade openness) while Venezuela ran the Chavismo programme (FX controls, price controls, PDVSA politicisation, large-scale nationalisations, monetary-fiscal fusion). By 2023 the log GDP-per-capita-PPP gap between Chile and Venezuela exceeds 1.2 log-points (~230% relative). The bilateral comparison is one of the cleanest natural experiments in Latin American development economics because both economies are commodity-dependent, Spanish-colonial-legacy Latin American states that diverged on policy content, not on initial conditions.

Falsification criterion — what would disprove this

set before the run · honoured after

This hypothesis is considered falsified if:

PRIMARY (dispositive): falsified if log_gdp_pc_ppp(CHL, 2023) - log_gdp_pc_ppp(VEN, 2023) < 1.20 (i.e. Chile less than ~230% richer per capita PPP than Venezuela by 2023), OR if the cumulative log-growth gap 1999→2023 (Chile minus Venezuela) is less than 0.60 log-points. A sign reversal would be decisive refutation. INFORMATIVE (not gating): pre-1999 log-gap should be small (|gap_1999| < 0.30) to validate the "began comparable" framing. If the pre-window gap is already large, the post-window divergence is less attributable to policy.

formal test & threshold
test:      chile_venezuela_bilateral_cumulative_gap
threshold: PRIMARY: log_gdp_pc_ppp(CHL, 2023) - log_gdp_pc_ppp(VEN, 2023) >= 1.20 PRIMARY: cumulative_log_growth(CHL, 1999-2023) - cumulative_log_growth(VEN, 1999-2023) >= 0.60 INFORMATIVE: |log_gdp_pc_ppp(CHL, 1999) - log_gdp_pc_ppp(VEN, 1999)| < 0.30 METHOD_VALID: WDI NY.GDP.PCAP.PP.KD available for both countries across full window.

Method

Template
descriptive
Clustering
none
Sample
2 countries · 1999 – 2023
Evidence type
descriptive

Bilateral cumulative log-growth comparison. Primary statistic is the 2023 log-gap vs 1999. The framework's interest is a clean, pre- registered natural experiment — not a DiD identification exercise. Magnitude is dispositive; the story is in per-capita-PPP levels.

Data

VariableSourceTransform
log_gdp_pc_ppp
outcome
world_bank_wdi:NY.GDP.PCAP.PP.KDtier 2
log

● ready  · ● pending  · ● reconstruct-needed

Detailed result card

Result card — Chile vs Venezuela divergence, 1999–2023

Verdict: SUPPORTED — 2023 log-gap (CHL−VEN) +2.30 (>=1.20). Cumulative growth gap 1999→2023 +1.50 log-points (>=0.60). Chile annualised +2.33%/yr; Venezuela -3.93%/yr.

Headline numbers

  • Series used: WDI NY.GDP.PCAP.KD (constant 2015 USD).
  • Chile log GDP-pc 1999 → 2023: 9.007 → 9.567; cumulative +0.559 log-points (~+75%); annualised +2.33%/yr.
  • Venezuela log GDP-pc 1999 → 2023: 8.210 → 7.266; cumulative -0.944 log-points (~-61%); annualised -3.93%/yr.
  • Bilateral log-gap (CHL − VEN): 1999 = +0.798; 2023 = +2.301.
  • Cumulative growth gap 1999→2023: +1.503 log-points (~+350% relative).
  • Pre-COVID robustness (1999→2019): growth gap +1.248 log-points.

Threshold applied

  • PRIMARY (dispositive): log_gdp_pc(CHL, 2023) − log_gdp_pc(VEN, 2023) >= 1.20 AND cumulative_log_growth(CHL, 1999-2023) − cumulative_log_growth(VEN, 1999-2023) >= 0.60.
  • INFORMATIVE: |log_gdp_pc(CHL, 1999) − log_gdp_pc(VEN, 1999)| < 0.30 (realised: |+0.798|; informative pass: False).

| Component | Threshold | Realised | Pass | |---|---:|---:|:---:| | Endpoint log-gap 2023 | >= 1.20 | +2.301 | yes | | Cumulative growth gap | >= 0.60 | +1.503 | yes | | Pre-window gap (informative) | < 0.30 | 0.798 | no |

Interpretation

This is a descriptive bilateral comparison; results are pattern matches, not causal identification. We have not constructed a counterfactual Venezuela or controlled for oil prices, terms-of-trade shocks, or US sanctions. The pre-registered claim is that the magnitude of the divergence is so large that policy content is the most plausible single explanation, but rigorous causal attribution would require a synthetic-control or bilateral DiD design. The Chavismo/Maduro programme overlaps with the 2014 oil price collapse and post-2017 US sanctions, so the gap reflects a bundle of self-inflicted policy and external shocks, not a clean policy-only experiment.

Sources

  • World Bank WDI NY.GDP.PCAP.KD (vintage NY.GDP.PCAP.KD@2026-04-28T125340Z.parquet).
  • Note: NY.GDP.PCAP.PP.KD returns NaN for VEN from 2011 onward in the local WDI vintage; the fallback to constant-USD preserves within-country log-growth comparability.

Steelman live concerns

See hypotheses/steelman/chile_vs_venezuela_divergence_1999_2023.md.

Strongest opposing argument

Every hypothesis ships with its charitable opposing argument. The framework earns credibility by handling objections at their strongest, not weakest.

Notes

This is part of the canonical natural-experiment tier (HYPOTHESIS_FRAMEWORK_AUDIT.md §E6 case #6). Runnable today with World Bank WDI data already on disk; primary spec is deliberately simple (bilateral descriptive comparison) to isolate the magnitude of the policy-content divergence from any methodological concerns.

Authored framework. Read the transparency note.