José Carlos Orihuela

Fragmented Layering: Building a Green State for Mining in Peru

This chapter explains the rise and evolution of environmental regulatory institutions for mining in Peru. The collected evidence shows that without the forging of bureaucratic autonomy, formal rules do not become “institutions” as defined by the canonical work of Douglass North. The forging of bureaucratic autonomy is a self-reinforcing process in which the activism of institutional entrepreneurs within specific organizations and crosscutting epistemic networks, and at particular junctures and contingencies, matters for the chances of the state activism that follows. Layer by layer, institutional entrepreneurs build bureaucratic autonomy, translating globalized blueprints and reinventing old state action.

Deeply Rooted Grievance, Varying Meaning: The Institution of the Mining Canon

In Peru’s contemporary political economy of development , a central rule of the game is canon minero , a law that requires national government to give back 50% of mining’s income taxes to the producing regions. Three analytical dimensions help us to tell the story of canon: legacy , contingency , and agency . By legacy, we mean the long-nurtured institutional regime in which canon minero’s short history unfolds, defined by the decentralization grievance and state weakness. Secondly, by contingency, we refer to the historical events exogenous to the canon political process that contribute to the creation of “political opportunity ” for changing rules: from the shaping processes of Velasco and Fujimori to a series of international economic crises and natural disasters. Thirdly, in our reading of the canon’s history, while as legacy and contingency set the context, agency has to be considered for a complete analysis. Within the structural features of Peru’s politics of decentralization, at particular historical contingencies, institutional entrepreneurs proposed a wide array of meanings to the label canon, which began as a legal term for an obscure tax and became the banner-word for regionalism .

Cycle of Abundance and Institutional Pathways

This introductory chapter presents a theoretical proposal to explain the patterns of institutional state construction during the recent commodity boom in Peru. To do so, this chapter is organized into five sections. The first one describes the new cycle of economic development based on natural resources and the main conflicts/tensions that it has produced in Peru. The second section documents the significant institutional state change produced in the country during the boom thanks, we argue, to the abundance cycle. This section shows how some institutions have emerged to manage the (distribution of the) benefits of resource extraction, while other institutions have emerged to manage the (distribution of the) cost of resource extraction. These institutional developments have different timing, and some are considerably more contested than others. The third section introduces the research questions and literature that explain the relevance of resource abundance cycles for institutional state development. The fourth section, the main one of this chapter, presents the arguments developed in conjunction with our findings. We propose that three dimensions explain these different pathways of institutional development in resource-abundant Peru: (a) preceding power distribution of state and society actors, (b) historical repertoires (legacies) of state and society action, and (c) the entrepreneurship of actors embedded in transnational networks . This framework aims to provide a comparative road map for similar analysis in Latin American countries affected by the recent commodity boom . The final section describes the book’s methodology and organization.

Context matters: the significance of non-economic conditions for income–pollution relationships in Chile and Peru

The Environmental Kuznets Curve (EKC) states that societies reverse air pollution once an income threshold is reached, which many scholars seem to read as a universal law. Proponents of the EKC have not explored empirically the conditions and mechanisms underpinning such an expected income–pollution relationship. With a comparative analytical study of the evolution of air pollution in the middle-income countries of Chile and Peru, this paper shows that the way economic development affects environmental quality is conditioned by interplaying ecological, cognitive, and political conditions. The evidence supports the view that income–environment relationships, in general, and air quality turning points, in particular, are influenced by highly idiosyncratic human-ecology context. Thus, income–pollution functional forms should be expected to vary, and to mutate, across time and space.