Earlier quoted context omitted.
On point 1) if the average salary in Chile is less than $5k/year then it costs more than a years salary to pay for a years schooling. That is incredibly expensive. By contrast in Australia it's around $10-12k/year for a local and the average full time wage is $75k/year! If Chilean education was as cheap as Australia's then a good education would cost less than $1k/year.
You are right, my bad. Actual average salary is USD 10k/year. Also notice the USD 5k/year is tuition for an engineering degree (2nd most expensive - only to med school) at the best universities, so it's pretty much one of the most expensive degrees you can get in Chile. Also, it is really easy to get a low-interest student loan (which a lot of people don't even pay). My guess is that access to education in Australia…
However, the general philosophy is the Higher Education Contribution Scheme. This is a fee that is largely flat, only paid on graduation, as an increased income tax requirement (a few percent more), if and only if your salary is above a threshold. Drop below that and you're no longer paying on your HECS debt. However, you can also voluntarily opt to pre-pay your debt for varying discounts. When I went to school (mid 90s), this fee was $1800/year. Any course at any university, from liberal arts at a country college to medicine or law at the most prestigious of institutions.