Weak institutions have been identified as a principal cause of the poor developmental outcomes of many resource-rich states. Research has largely focused on national-level institutions and governance, whereas their subnational equivalents remain understudied. Subnational governments, partially empowered by decentralization reforms, have increasingly sought to use existing institutions to influence mineral resource governance although they have no formal authority over such resources. This article examines the implementation of land-use zoning and planning in three Peruvian regions (2007–2016). It focuses on how and when subnational governments seek to influence mineral governance and under what conditions they succeed in strengthening institutions for inclusive and sustainable development. Theoretically, the article draws on the literature on decentralized forest governance and empirically it is based on extensive ethnographic research carried out in the three regions, written primary sources and 139 semi-structured interviews.

Our analysis suggests that, whereas regional governments have strong incentives to use land-use zoning to influence mineral governance, they often lack capacity, accountable representation, and support from the central government. Still, land-use zoning has provided regional governments with information about natural resources that has been used in negotiations with mining companies, but also to improve regional planning. To have durable impacts on development, profound state reform to achieve sectoral integration and political decentralization is, however, needed. Our findings add to debates about extractive governance by showing how subnational governments, without having formal authority over mineral resources, still play an important role in shaping the developmental outcomes of resource extraction. Our paper also provokes important questions regarding how subnational governments could be included in extractive governance and which mechanisms for reconciling different interests are likely to be most effective. All told, a better understanding of how inclusive subnational institutions are effectively enforced and gain stability is crucial for transforming resource wealth into sustainable development.