Chilean President Sebastian Pinera has vacated his entire cabinet to form a new government and introduce the social reforms required by protesters.
"I sent all my ministers a warning to restructure my cabinet to deal with these new demands," he said.
It is not yet clear what the form of redistribution will be.
More than a million people joined a peace rally on Friday in the capital city of Santiago, calling for social justice.
Mr Pinera stated that he had heard the requests from the streets.
"We are in a new reality," he said. "Chile is different from what it was a week ago."
The president also announced that a curfew was canceled a week ago in cities in Chile.
The opposition also calls for an end to the continuing state of emergency.
At least 1
Friday's march came at the end of a week of violent clashes between activists and riots.
The President tweeted on Friday: "We have all changed. Today's joyful and peaceful hike, in which Chileans have sought a fairer and united Chile, opens reliable avenues for the future."
What happened on the hike?
Santiago Governor Carla Rubilar said at least one million people have left for the capital – more than 5% of the country's population.
In Twitter, she stated that the protesters "represent the dream of a new Chile".  Organizers said it was the largest demonstration there since the restoration of democracy in 1990.
The participants walked miles around the city, tossing pots, waving flags and calling for reform.
Protesters also took to the streets in every other major Chilean city.
"We ask for justice, honesty, an ethical government," 38-year-old Francisco Angitara told AFP news agency in Santiago.
What is the origin?
Initially, the protests were triggered by the now halted increase in subway tariffs, but they increased and took widespread complaints about the cost of living and inequality.
There were outbreaks of robberies and arson in the days of the demonstrations. More than 7,000 people were detained.
Chile's military has seized security in Santiago, which is in a state of emergency with thousands of police officers on the streets.
Chile is one of the richest countries in Latin America, but also one of the most disadvantaged – it has the worst income levels among the 36 OECD member states.  On Wednesday, the president announced a package of reforms aimed at ending protests, including raising the basic pension and the minimum wage.