Participatory Democracy and Effective Policy: Is There a Link? Evidence from Rural Peru

We examine the relationship between participatory democratic institutions and effective agricultural policy in rural Peruvian municipalities, using a unique quantitative dataset of 100 Peruvian municipalities at two points in time, allowing us to examine (a) bottom-up, grassroots participatory governance institutions, and (b) Peru's top-down participatory budgeting reform implemented in all Peruvian sub-national governments in the early 2000s. We find that voluntary participatory fora are strongly and significantly associated with more active and more effective agricultural policy. However, we find more ambiguous results when examining Peru's mandatory participatory budgeting institutions, finding more active, but less effective agricultural policies after their implementation.