Problems of Development in Peru

Abstract

During the last national election in Peru, one of the candidates charged that the Indians probably lived better under the Inca rulers. Rather than being political hyperbole, this observation points up the stark reality which is the root cause of Peru's economic and social problems. With a relatively thin middle class, Peru's population of about 11.6 million is largely polarized into a small elite, whose wealth is conspicuous even by Latin American standards, and the larger proportion of the population living in the high sierra or in the slums surrounding each coastal city, which barely manages to exist under conditions of abject poverty. This skewed distribution of wealth and income, long apparent even to the most casual observer, has been confirmed by a recent study which indicates that the top 10 per cent of the spending units receive 60 per cent of the disposable income, and 8,760 spending units, representing only .25 per cent of the total, receive 35 per cent of the income.