Access to critical minerals and local governance: the case of mining and education in Peru

Manzano O.; Valdivia D. · Oxford Review of Economic Policy (2026) · DOI: 10.1093/oxrep/grag018

Resumen

The global energy transition has increased the demand for critical minerals, intensifying mining activity in resource-rich countries while raising concerns about local governance and social outcomes. This paper examines how large-scale mining and the design of fiscal redistribution mechanisms affect educational outcomes in Peru. Exploiting quasi-experimental variation from the location and timing of mine openings (exogenous exposure shocks) and a 2011 mining tax reform, we analyse student-level reading and mathematics scores from 2007–16 using a difference-in-differences framework. The reform increased government take from mining by allowing new levies to be deducted from corporate income taxes, reducing transfers to subnational governments through the mining canon while leaving hydrocarbon transfers unchanged. This institutional change allows us to separate income effects from negative local externalities associated with mining activity. We find that regions receiving both mining and hydrocarbon revenues exhibit better educational outcomes than those relying solely on mining transfers. However, proximity to mining operations is associated with lower test scores. Crucially, the tax reform reversed previously positive effects of mining revenues on education without mitigating negative local impacts. These results suggest that efficiency-oriented tax reforms can weaken local development outcomes by undermining revenue channels that support human capital, highlighting the importance of fiscal design for sustaining the social licence to operate in extractive industries. © The Author(s) 2026. Published by Oxford University Press on behalf of The Oxford Review of Economic Policy Ltd. All rights reserved. For commercial re-use, please contact reprints@oup.com for reprints and translation rights for reprints. All other permissions can be obtained through our RightsLink service via the Permissions link on the article page on our site-for further information please contact journals.permissions@oup.com. This article is published and distributed under the terms of the Oxford University Press, Standard Journals Publication Model (https://academic.oup.com/pages/standard-publication-reuse-rights)