Explaining the regional economic heterogeneity in Ecuador

• Author: Mendieta Munoz R., Raileanu-Szeles M., Beltrán Romero P., Piedra Pena J.A.
• Pages: 399-406

Bulletin of the Transilvania University of Braşov

Series V: Economic Sciences • Vol. 8 (57) No. 2 - 2015

Explaining the regional economic heterogeneity

in Ecuador

Rodrigo MENDIETA MUÑOZ1, Monica RĂILEANU-SZELES2

Pablo BELTRÁN ROMERO3, Juan Andrés PIEDRA PEÑA4

Abstract: This paper aims to present the economic heterogeneity of Ecuador’s regions

using a descriptive analysis, and also to explain its main causes and implications. In

comparison to the European Union, Ecuador exhibits a much higher degree of economic

heterogeneity within regions and provinces. We relate this pattern to the dynamics of the

economic structure, and we also highlight the progress done by now in enhancing regional

convergence in Ecuador. The implications of the regional economic heterogeneity are

important for the design of effective governmental policies.

Key-words: economic convergence, regional economy, heterogeneity

1. Introduction

Like many other Latin-American countries, Ecuador presents important economic

disparities at the regional level. The economic heterogeneity is therefore one of the

strongest characteristics of the Ecuadorian regional economic development. The

cantons of a certain province could be very different in terms of economic

productivity and growth, as well as spatially close provinces could also exhibit

different economic patterns. Despite these differences, there are provinces sharing

common economic characteristics.

Therefore, the national model of economic development does not reproduce

itself at the provincial level too, so that in Ecuador it is difficult to conceive and

apply economic and social policies generating economic and social positive effects

for everybody. This paper analyzes the economic heterogeneity at the provincial

level in Ecuador, based on the gross value added per capita (GVA). The data are

1 Facultad de Ciencias Económicas y Administrativas, y Grupo de Investigación en Economía

Regional, Universidad de Cuenca, Ecuador, rodrigo.mendieta@ucuenca.edu.ec

2 Transilvania University of Brasov and Prometeo at University of Cuenca, Ecuador,

monica.szeles@unitbv.ro

3 Facultad de Ciencias Económicas y Administrativas, y Grupo de Investigación en Economía

Regional, Universidad de Cuenca, Ecuador. Email: pablo.beltran@ucuenca.edu.ec

4 Facultad de Ciencias Económicas y Administrativas, y Grupo de Investigación en Economía

Regional, Universidad de Cuenca, Ecuador. juan.piedra@ucuenca.edu.ec