The name of Aristocratic Republic () is given to the period following the 1895 election of Nicolás de Piérola as President of Peru. This period was characterised by the political dominance of an oligarchy dedicated to agro-exports, mining and finance, through the Civilista Party. The term was coined by historian Jorge Basadre. During this period, the so-called Second Civilism () took place, in contrast to that of 1872 to 1876.

The period begins with the rise to power of Nicolás de Piérola, which marks the beginning of a succession of democratically elected governments, until the coup of Augusto B. Leguía in 1919. The only interruption of this succession occurred in 1914 when, due to differences between the Civilista Party and Guillermo Billinghurst, General Óscar R. Benavides carries out a coup d'état to call general elections. It is the second longest period of democratic succession in the republican history of Peru.

Background and establishment The colonial situation of the country continued after independence, but this time no longer depending on Spain but through dependence on European and North American capital, and it is particularly during the Aristocratic Republic that dependence on North American capital begins to be forged. The Aristocratic Republic is the period of republican history between the years 1899 to 1919 characterised by the succession of governments led by the country's political and economic elite, marked by the alliance between the political and economic elites to govern Peru, eliminating any other type of political proposal that did not come from this consensus.

Consensus of political forces It begins with the consensus of two predominant political forces, civilists and democrats, to overthrow Andrés Avelino Cáceres. This was followed by the alliance between Nicolás de Piérola and the civilist oligarchy, who needed a figure with great popular support to be able to pacify the country. Thus, Piérola became their figurehead. He allowed political stability from 1895 to 1899, the year in which he transferred power to the civilistas who took it until 1919, since they had managed to occupy strategic public positions during Piérola's presidency such as the Electoral Apparatus, which allowed them manipulate the elections to allow the defeat of the Democrats. The political consensus between the civilist and democratic parties represented the economic interests of the sugar planters of the coast, the industrialists, the merchants, the land-owning elites of the mountains and others.

European crisis This period was also characterised by the economic crisis that hit Europe between 1892 and 1895, which produced a reduction in foreign investments in Peru, as well as an increase in national investments. Which meant that exporters could be ready to export once Europe emerged from the crisis in 1895 and began to demand products such as sugar, wool, cotton, coffee, copper, zinc, and lead. Exporters also benefited from the favorable exchange rate due to having a strong currency. This export boom allowed profits to be reinvested to modernise export plants. It also allowed profits to be reinvested in local manufacturing industries, as wage earners in the export sector had become a large market for the products of these industries.

The lack of imports due to the European crisis meant that investment was also made in the production of parts for the machinery of sugar mills and foundries.

Initial reforms The Piérola Government carried out a series of economic and fiscal policies: one of the most important was to place tariff barriers on imported products in such a way as to encourage industrialisation by import substitution. Another measure to encourage trade towards the interior of the country was roads, for which he mobilised the natives of the surrounding communities.

At the tax level, he "eliminated" the Indigenous Tribute in order to leave the Departmental Boards that sympathised with Cáceres, his political enemy, without income. This meant nothing as the Indians were still affected by using the salt tax, which led to peasant protests that were violently repressed, causing many deaths.

Exclusion and oppression The other side of the economic boom was exclusion and oppression. Piérola's government was autocratic, “paternalistic,” and not democratic. He opposed the law that allowed those who could not read or write to vote. Since the popular sectors could not vote, and only the wealthy sectors could do so, the continuation of conservative governments was guaranteed. As a consequence, the lower classes would not be integrated into political power and their demands would not be heard.

In addition to this, Piérola continued with Cáceres' policy regarding the landowners of the regions of Peru, joining them to restore the hierarchical relations of authority that had been destroyed during the war and using repression and exclusion if the subordinate classes did not accept it.

The central government depended on the gamonales—the great feudal lords of the Andes—to control the discontent of the peasants. Thus, the representatives of the gamonales who obtained positions for congress in the regional elections supported the central government in exchange for it letting them govern as they wish.

Beginning of economic dependence Mining Mining in the mountains revived after the war, with the boost of silver mining in Casapalca exploited by businessmen in the area since 1880, and continued with the discovery of new mines in Morococha in 1890. But in 1892, two events occur: first, the international fall in the price of silver and then the suspension of the minting of silver coins in the country, caused the profits of silver mining entrepreneurs to fall. Around the same time, the international copper boom began, which some local businessmen began to exploit. Around 1893, the construction of the train to La Oroya was completed, which would make the Morococha and Cerro de Pasco mines more accessible, and would allow North American investments to enter and buy at very high prices most of the mines and even the Casapalca smelter. These North American investments were financially on par with the Peruvian State and far above the Peruvian miners.

The entry of American capital allowed the expansion of mining through the use of new technology, but left this area of the country backward because the profits from this exploitation went to the United States. Furthermore, the Peruvian State did not regulate this sector, which allowed these companies to do things as they liked. As a result of this, 's internal rate of return was 55%, higher than that of the 3 Chilean copper companies that only reached 35%.

When the mines were exploited by local businessmen, the money from the profits was reinvested in the region in agricultural production and commerce in the region. Even promoting the cultivation of coffee in the Peruvian jungle. When the North Americans arrived, the profits did not return, but despite this there was enough money left to generate production and trade, leading to the creation of a new regional elite in central Peru, made up of miners, landowners and merchants.

The landowners and peasants in the Andes The relationship between the landowners and the peasants would be characterised by the enclosure of the communities. Because landowners and businessmen sought to expand their lands to increase their crops, they kept an eye on the possessions of farmers and peasant communities. The latter, which were already weakened by the war as their male population and the amount of crops were reduced, were easy prey for the usurpation of land by the landowners who resorted to coercive collections for debts or forced purchase. The causes of violence began to germinate, as large estates are formed, directed by despotic landowners, and as a result of which many peasants are left without land.

The situation in the southern mountains has a different situation due to the export of wool to the United Kingdom. These exports had doubled between the period of 1885–1895 and 1920, going from 2,624 metric tons of wool to 5,286. There were two types of wool: low-quality wool produced by large-scale landowners, and high-quality wool that came from the altiplano and that were sold to merchants from Arequipa. Thus an economy of production and exchange was formed between peasants, merchants and landowners.

Sugar and cotton in the coast

On the other hand, on the northern coast, sugar was the first Peruvian export product since before the war, the entry of new investors allowed this industry to revive. Of the old landowners, some survived and some sold due to bankruptcy. During this period there were two booms: the first in 1890, in which sales grew by 83%, and the second in 1914 (during the First World War) in which sales grew by 77%.

Likewise, on the central coast, specifically in Ica and Cañete, cotton was produced. This was the second export product. The cotton planters did not have as much political and economic weight as the sugar planters did. On the other hand, this industry benefited both large producers and peasants, since cotton growers gave land in exchange for half of the production and also hired migrants from the mountains to cultivate their best fields, who then returned to their lands and reinvested in their own crops.

The rubber boom

The economy in the jungle developed between 1880 and 1920. In 1880, Europe and the United States demanded a high quantity of rubber, so Peru and Brazil became exporters of this product, which came from the collection in the rubber trees that existed and not from any plantation. The extraction was carried out by native Indians who were semi-enslaved, forced to work and who died of malnutrition and disease. This produced an international scandal over the treatment of the natives by the Peruvian Amazon Company between 1908 and 1912. The main "rubber barons" were Carlos Fitzcarrald and Julio César Arana, who used the money from the profits in luxurious imports and to maintain their lifestyles. In 1912, its exports reached 30% of total exports, however the economy of the area did not develop due to the lack of links with the national economy. Finally, in 1915 rubber prices began to fall, because the supply of this product became greater and the more industrialised production of the Far East monopolised the production of this product. Thus in 1920, the rubber boom ended and the Amazon economy stagnated again.

Oil as the foreign enclave Once again, primary exploitation was where foreign demand was directed. The oil exploitation that was in the hands of foreign companies was located on the northern coast of Peru, Piura and Tumbes. In 1904, the exploitation of this resource increased due to the increase in national and international demand. Shortly before the First World War, New Jersey's Standard Oil purchased the British-owned oil fields of La Brea y Pariñas. This company is better known in Peru as the International Petroleum Company (IPC). The profits of the IPC were very high and the taxes were scandalously low, since they had enough power to manage the politicians.

The dependency position