This research starts with a literature synthesis on risk and its measurement; then, as a second point, presents the methodological process for the construction of an index to measure social risk for Cajamarca’s department in Peru, which has been based on the application of probability theory. The estimation methodology addresses two approaches: i) the probability of occurrence of an event that generates a total or partial paralysis of the private sector activity for a specific month, and ii) the probability of occurrence of at least one day of paralysis for a specific month. The data used has been recorded for the period between January 1992 and December 2022, based on journalistic information. The results are plotted in two-time series which show the evolution of the Cajamarca Social Risk Index in basis points for both methodological approaches. Additionally, I present a comparison of...

This is the first article in a series of two. A NAIRU-Keynesian model is developed for Peru’s departments (regions) to analyse whether there is a stable relationship between inflation and unemployment, and inflation and the output gap as documented in the Peruvian literature. I applied GLS for model estimation. My results document a positive relationship between future inflation rates and the gap in departmental unemployment rates concerning national unemployment rates, I evidence the Phillips curve flattening at the departmental level when estimating with the output gap, which is consistent with the national aggregate models, but there is a more elastic relationship when estimating with departmental unemployment rates. This represents unobserved effects for the monetary policy maker and requires further research.

This is the second article of a series of two that documents the limited efficiency of the Peruvian monetary policy on local inflation rates. With this research I deepen on my preliminary findings on the unobserved effects of Peruvian monetary policy using departmental Phillips curves. On this occasion, the motivation seeks to answer the question: by incorporating the NAIRU-Keynesian and neo-Keynesian structural model criteria for the Peruvian case, what other unobserved effects of monetary policy would be found in Peru’s departments? Two models of structural equations are developed to estimate the impact of monetary policy at sub-national levels, the first considers the unemployment rate (NAIRU-Keynesian) and the second considers the departmental GDP gap, from which there are counterproductive results that start from the misalignment of departmental economic cycles with the national o...