2019-02-052019-02-052019-02-05http://repositorio.redinvestigadores.org/handle/Riec/13We use new firm-level data from Chile to document resource misallocation in favor of politically connected firms during the transition from dictatorship to democracy. We find that firms with links to the Pinochet regime (1973–1990) were relatively unproductive and benefited from resource misallocation during the dictatorship, and those distortions persisted into democracy. We show that, after learning that the dictatorship was going to end, firms in the dictator’s network increased their productive capacity, experienced higher profits, and obtained more loans from the state-owned bank. We test for different explanations and provide suggestive evidence consistent with connected firms aiming to shield their market position for the transition to democracy.63 páginas : gráficas, tablasPDFengOpen AccessWorking paperD2 - Production and OrganizationsG2 - Financial Institutions and ServicesG3 - Corporate Finance and GovernanceM2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics: Business EconomicsN86 - Micro-Business History: Latin America; CaribbeanTransitionDistortionsFirmsNetworksChile -- Política y gobiernoPolítica de transición -- ChileDictadura -- ChilenaAcceso abiertoAtribucion-NoComercial-CompartirIgual CC BY-NC-SA 4.0D2 - Producción y organizacionesG2 - Instituciones y servicios financierosG3 - Gobierno y financiación de la empresaM2 - Administración de empresas y economía de la empresa; Marketing; Contabilidad; Economía de la gestión de personal: Economía de la empresaN86 - Historia de las microempresas: América Latina; Caribe