- The rejection of the new constitution gathered 61.9% of the vote.
- Voter turnout was historically high: more than 13 million people went to the polls.
- Two non-excluding hypotheses can shed some light on the result.
- The first argues that many people, historically detached from electoral processes, participated in this referendum to reject the proposal.
- The second points out that many votes that favored a new constitution in 2020 chose to reject the proposal.
- In any case, the choice to vote down the proposal was overwhelming across different demographic groups.
Chile voted last Sunday on whether to pass or reject a new constitution drafted by a Constitutional Assembly that had been especially elected for this purpose in 2021. Voters overwhelmingly rejected the proposal by a margin of 62 to 38. The result of this plebiscite was not in line with what polls had forecast. Although these showed a majority voting down the proposed new constitution several weeks before the vote, the margin by which they did it was greater than predicted: 7.9 million votes (61.9%) against, while only 4.8 million voted in favor (38.1%).
Voter turnout was historically high: more than 13 million people went to the polls (85.8% of estimated eligible voters), being only surpassed by the 1989 presidential and parliamentary elections.
It is thus highly likely that compulsory voting with automatic enrollment, applied for the first time since at least 1988, will be adopted for future elections too.

The surprise, in part, stems from the lopsided majority that had voted in favor of drafting a new constitution in 2020, as well as the results of the presidential election last December, where a left-wing coalition that unanimously supported changing the constitution won power.

Two non-excluding hypotheses can shed some light on the result. Both overgeneralize, which is inevitable, but they are useful nonetheless.
The first argues that many people, historically detached from electoral processes, participated in this referendum to reject the proposal. These people are characterized by a low interest in politics, and on this occasion, they would have been in favor of maintaining the status quo.
Figure 2 shows that the total number of votes in favor of drafting a new constitution (2020), for current President Boric in the presidential election run-off (2021), and for passing the proposal last Sunday, remained relatively constant. On the contrary, last Sunday's rejection marked a substantial increase in the number of votes compared to those against a new constitution in 2020, and those of the right-wing candidate Kast in the second round of the 2021 election.
The second hypothesis points out that many votes that favored a new constitution in 2020 chose to reject the proposal. There would be three sources of discontent feeding this change of heart. The first is with the government and the current state of the country (inflation and crime); the second, with the Constitutional Assembly that drafted the proposal; and the third, with the proposed new constitution itself that was up for a vote.
A (binary) referendum tends to polarize society, so a narrow result can exacerbate the problem. Another possibility is that different groups vote very differently, which can also be a problem. However, the choice to vote down the proposal was overwhelming across different demographic groups.
First, participation was high in all 16 regions of the country, with Aysén having the lowest participation (71.9%), and O'Higgins the highest (92.8%). Regarding their preferences, the rejection of the proposal dominated comfortably across regions: from the Metropolitan Region of Santiago (55.3%) to Ñuble (74.3%). If we also consider high turnout, the results clearly reflect the will of the overall population.

When disaggregating the result by municipal-level income, the rejection of the proposal appears negatively correlated with income quintiles. This was unexpected: while 75.1% of voters from the lowest quintile rejected, only 60.5% from the highest quintile opted to do the same.
Something similar happened with turnout: it was higher in the lower income quintiles.

The cabinet shuffle of Tuesday, September 6th, delivers a clear message, as it seeks to incorporate more experience, especially political, through seasoned names perceived as more moderate within the Chilean political spectrum.
The possibility of a new Constitutional Assembly remains open, but it will depend on political negotiations in the coming weeks. The biggest disadvantage of repeating the process lies in the protracted uncertainty concerning key matters for investment and economic growth, such as regulations for the mining industry, and the strength of property rights.
On the economic front, many of the reforms advocated by the current government's electoral platform will now be put on hold, and will probably be negotiated with a Congress where the political weight of moderate politicians has grown after Sunday's result.
In our opinion, proposed reforms in pensions, education, and taxes should attempt to win broader support, especially considering that the Executive does not have a majority in the Legislative. The administration will have to settle for moderate victories in the three-and-a-half years it still has, or resign itself to being trapped in a Congress that it does not control.
This article was written with Francisco Simian.
This material is for informational purposes and is intended to be used for educational and illustrative purposes only. It is not designed to cover every aspect of the relevant markets and is not intended to be used as a general guide to investing or as a source of any specific investment recommendation. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument, investment product or service. This material does not constitute investment advice, nor is it a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional adviser. In preparing this material we have relied upon data supplied to us by third parties. The information has been compiled from sources believed to be reliable, but no representation or warranty, express or implied, is made by Altafid, PBC or its affiliates, as to its accuracy, completeness or correctness. Altafid, PBC or its affiliates do not guarantee that the information supplied is accurate, complete, or timely, or make any warranties with regard to the results obtained from its use. Altafid, PBC or its affiliates have no obligations to update any such information.