In 2003, Peru adopted the “Framework Law on participatory budgeting”. It requires all the municipal and
regional governments to institutionalize a yearly “participatory budgeting process”. The Peruvian Participatory Budgeting
(PB) is inspired on the PB-experiment in Porto Alegre, Brazil, but differs on a number of important principles of design.
Building on the existing evaluations of the Peruvian nation-wide implementation of PB (2003-2007), this article addresses
both the pitfalls and the transformative potential of Peruvian PB. It does so by contrasting the Peruvian PB with PB in
Porto Alegre along the four dimensions on which transformation has been recorded in Porto Alegre: (1) citizens, (2) civil
society, (3) the state and (4) civil society – state relations.