Shock in the price of copper on poverty in Peru: An analysis at the provincial level Shock del precio del cobre sobre la pobreza en el Perú: un análisis a nivel provincial

Abstract

In the context of high copper prices in recent years, which quadrupled its value since the beginning of the 2000s, this
research proposes to analyze the effects of variations in the copper price, which is the main mineral exported by Peru, on the
poverty ratio. For this reason, a DIF & DIF model is proposed. The results indicate that for every rise of 1% in the copper
price, from the super cycle of commodities price, in the longterm, declines of 0.061 percentage points in poverty rates were
generated in provinces where copper is extracted in contrast to provinces where copper is not extracted. In conclusion, copper
is a very important commodity for the development of Peru.