ABSTRACT
This chapter discusses about the agrarian problem, and the causes of agricultural stagnation. It also discusses whether agricultural growth is affected by the reform. The chapter overviews an income distribution in Peru. It explains about the effects of the agrarian reform on rural poverty. The Peruvian agrarian reform is almost the only enduring Latin American example of a planned major reform without any revolution. The agrarian reform had two central objectives, namely, to increase agricultural growth and to improve the standard of living of the rural population. Investments in industry are stimulated thus making investments in agriculture relatively less profitable. In addition, agrarian reform is becoming accepted as being a necessary reform, thus making investments in agriculture even more risky. The government intervened frequently to keep agricultural prices. After 20 years of agrarian reform efforts in Peru, agricultural growth continues to be below that of the population.
