Research

We study whether co-candidacy ties, formed by running in the same party for office in the same election, are sufficient to generate favoritism in public procurement. Using close municipal elections in Peru as a source of quasi-random variation in political connectedness, we compare discretionary procurement outcomes for suppliers linked to the winning mayor with those linked to losing candidates. These suppliers are unelected council candidates who hold no government office and exercise no procurement authority, isolating the co-candidacy channel from formal power. Connected suppliers are twice as likely to receive any discretionary contract from their own municipality and earn 22% more money from these contracts. The premium persists when the mayor leaves office and co-partisan connectedness to a different municipality does not generate a similar premium. We finally show that connected suppliers are less specialized, suggesting that the co-candidacy premium is not driven by quality but rather by preferential access to procurement opportunities.

Community engagement policies are widely used to reduce crime by strengthening coordination between residents, police, and local service providers. This paper studies whether such policies remain effective in socially segmented settings. We exploit the interaction between a common criminal shock—the consolidation of Tren de Aragua by early 2022—and fixed cross-sectional variation in prior exposure to a local community engagement policy across police jurisdictions in Peru. We estimate difference-in-differences and common event-time specifications separately for municipalities with and without significant Venezuelan migrant presence. We find sharply divergent effects. In municipalities with significant Venezuelan presence, the policy increases extortion after gang consolidation by roughly 100% relative to the outcome mean. In municipalities without significant Venezuelan presence, the estimated effect is negative, with consistently declining post-consolidation patterns in the dynamic specification. We find no comparable divergence for non-gang-related outcomes. We interpret these findings as consistent with a mechanism in which participation requirements strengthen protection for socially integrated residents while leaving migrant populations more segregated and vulnerable to gang recruitment. More broadly, the results suggest that community engagement policies may backfire when access to protection is unequal and minority populations remain excluded from local institutions.

This paper examines the effects of mining booms on local labor markets in contexts where traditional gender roles limit women’s participation. Results show that job creation is primarily driven by increased male employment in mining, with spillovers into construction and local services. Female employment responses are mixed, while some women gain access to these jobs, others shift toward unpaid domestic work. The expansion of mining appears to benefit men and unmarried women, while married women and those with caregiving responsibilities face reduced opportunities. Women are also more affected by heterogeneity in age and education. The findings underscore the role of the care economy and gender dynamics in shaping labor market outcomes during resource booms.

The local effects of mining might simply come and go with mine production. In this paper we revisit Aragón and Rud’s (2013) study of the Yanacocha mine, frequently cited to account for local economic effects and backward linkages, but we offer a more nuanced interpretation: first, effects fade with the mine exhaustion; and second, impacts are the result of consumption boom-and-bust dynamics. While we find it more conceptually accurate to reserve the concept of backward linkages for effects of a productive nature, our evidence reveals that unskilled services is the one sector that benefits, in contrast to manufactures and skilled services. We stress that impact evaluations of mines are contingent to time and place, and contend that exploring the extent to which multipliers generate spillovers is central. The short-run effects of a mine might in fact give little indication of how to tell or make a blessing from a curse.

We typify resource-based economic development in Peru in the period 2001–2015, analyzing regional export specialization, growth volatility, and de-industrialization, three resource curse symptoms. With the commodity cycle: (i) export specialization is not the same in all mineral producer regions; (ii) regional growth volatility is much higher at regional level than at national level; and (iii) there is no convincing case of de-industrialization and the Dutch disease, because a world economy surge does not operate as a national resource discovery. We say economic evolution within resource-rich Peru is volatile and spatially varied. At the national level, gold-and-copper-dependent Peru is not as vulnerable as other mineral dependent countries to external shocks. At the sub-national level, growth volatility is very high for clusters of regions: we should be asking where, when, and why there is curse or blessing, and what type of it, rather than searching for a definitive universal answer on the developmental effects of mineral abundance.