Title: Mining, Local Governments and Access to Water in Peru
Author/Institution: Alvina Erman – Master’s Thesis, Lund University
Publication Year: 2014
Resource Extraction, Governance, and Local
Legitimacy
Erman’s master’s thesis explores the intersection of mining, decentralization, and public service provision in Peru’s mineral-rich regions. The study argues that the expansion of extractive industries has transformed not only local economies but also the political expectations placed on municipalities. While mining revenues from Peru’s canon minero were intended to finance social and environmental services, Erman finds that many local governments diverted funds toward visible infrastructure rather than basic needs such as water and sanitation—undermining both governance legitimacy and the industry’s social license to operate.
Methodological Approach and Empirical Findings
Employing a quantitative cross-district analysis complemented by institutional review, Erman compares mining and non-mining municipalities across multiple regions. Using fiscal data, service-coverage statistics, and regression modeling, she demonstrates a paradox: districts receiving higher mining transfers frequently show slower progress in water access. This outcome is linked to weak institutional capacity and political incentives that prioritize short-term capital works over long-term service sustainability. The analysis exposes how extractive dependence can distort governance outcomes, even under democratic decentralization.
Implications for Social License and Policy Design
Erman’s research positions water access as a concrete indicator of social legitimacy. When citizens perceive that mining wealth fails to improve essential services, the social contract between communities, government, and industry erodes—fueling protest and mistrust. The thesis calls for stronger accountability frameworks linking mining revenues to measurable social outcomes, particularly in water governance. For policymakers, it underscores that achieving durable social license requires not only environmental compliance but also visible public-service equity in mining-affected territories.