The Pattern of Growth and the Expansion of the Middle Class in Peru

Aug 2019
The structure and the sectoral composition of Peruvian economy during the most recent period of economic prosperity has had a fundamental role in the expansion of the middle class. Following a macroeconomic analysis of data panel at a departmental level, it is proved that in the pattern of the sectoral and territorial growth of the country, the services sector supported the expansion of the middle class in most of the departments, resulting in a convergence dynamics among them. Thus, in those departments with major setbacks in terms of income, inequality and access to basic services, the impact of the services sector in the expansion of the middle class was greater. This analysis is complemented with data at the household level, which shows that work and income coming from employment in the services sector were the main driving forces behind economic progress, mainly from work in the informal private sector and self-employment.