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The scope and intensity of political violence in a democratizing society are influenced particularly by regional opportunities arising from state weakness that favor the formation of coalitions against the state. The illicit market for coca in Peru's Upper Huallaga Valley fostered a tactical alliance between Shining Path guerrillas and coca producers that funded Shining Path's national presence. Falling coca prices in the 1990s, combined with key state-strengthening measures under the Fujimori government, destroyed that relationship and weakened the' guerrilla organization.

Examines the development of a populist policy compatible with market-oriented economic reform under President Alberto Fujimori, involving executive largesse in the form of public works and infrastructure projects.

A few weeks before the April 1995 elections, President Alberto Fujimori paid yet another visit to Puno, the southernmost department in Peru's highlands. On the agenda of this visit, the 20th trip that the president had scheduled to this region in less than a year, was a series of events designed to remind skepticalPuneñosof the tremendous scope and variety of public works and infrastructural projects which the Presidential Ministry was coordinating throughout the department. By this time, every comer of the department had witnessed the construction of a new school or clinic, the repair of some strip of highway, or the renovation of some municipal park. Evidence of new construction was everywhere, along with the black-and-orange signs announcing each project as another initiative sponsored by the main social development agencies linked to the Presidential Ministry. During the visit, the president would inaugurate a few large-scale projects for good measure: a hydroelectric dam, a social security hospital, an ambitious scheme to pipe drinking water from Lake Titicaca, and a project, in partnership with Russian investors, for extracting the region's untapped oil reserves.