No abstract

In this paper, we estimate the Total Factor Productivity (TFP) for the Chilean Construction Sector, considering an annual period between 1986 and 2015. The contribution of the productivity to the sectorial growth is estimated residually, based on a Cobb-Douglas production function for the sectorial GDP and independent measures for capital and labor, corrected by quality and intensity of use. As a result, the sectorial TFP has exhibited a downward trend in the last five years, after remaining virtually flat since 1986 to 2011. The economic growth of the sector shows to be dominated by the accumulation of factors rather than by the efficiency with which they are used in the productive process. This could explain, partially, the vulnerability of sectorial activity to the economic cycle.

In this paper, we approached the concept of real estate bubble, analyzing the risk its bursting could generate for the Chilean financial market. Specifically, we analyzed the relationship between real housing prices, the economic activity index, and mortgage interest rates denominated in inflation-linked units from 1994 to 2020. The analysis was based on a second order Markov switching model with the predetermined variables mentioned later, whose parameters were obtained through the expectation–maximization algorithm. Then, we built a probability index as early warning indicator for potential imbalances in the real estate price that could put financial market stability at risk. The indicator is important to evaluate economic policy calibrations in time. A main finding was that the real housing price had a non-linear relationship with economic activity and the mortgage interest rate. Therefore, the evolution of the real estate price has been consistent with fundamental macroeconomic variables, even under a high growth regime, with increases above 12% per year. About 92% of housing price variability derived from changing macrofinancial conditions, suggesting a low margin of speculative behavior.

Cement is a non-storable input in the medium and long term. The evidence in Chile shows that cement supply and demand are in relative equilibrium, so the demand or supply of this input can measure the activity in the structural construction or work. The aim of this paper is to backcast the series of cement production since January 2009, using as an instrument the connection of the series of cement sales, available on a monthly basis from 1991-2015. To this end, we apply the Johansen cointegration method. Then, a model of state space is proposed to characterize the cycle of cement production, taking its connection with investment in construction into account. Indeed, cement production, technically, is a leading indicator of sectoral investment.

In this study, we analyzed how urban, housing, and socioeconomic variables are related to COVID-19 incidence. As such, we have analyzed these variables along with demographic, education, employment, and COVID-19 data from 32 communes in Santiago de Chile between March and August of 2020, before the release of the vaccines. The results of our Principal Component Analysis (PCA) confirmed that those communes with more economic, social, organizational, and infrastructural resources were overall less affected by COVID-19. As the dimensions affecting COVID-19 are based on structural variables, this study discusses to what extent our cities can be prepared for the next pandemic. Recommendations for local decision-makers in controlling illegal immigration and investing in housing and urban parks are drawn.