The impact of crises on the performance of the Ecuadorian agricultural sector

Abstract

This study analyzes the impact of macroeconomic crises on the agricultural sector of Ecuador. The methodology uses a vector autoregressive (VAR) approach that allows identifying the channels for the transmission of financial and economic crises towards the sector’s performance in 2008-2020. In this context, two possible scenarios are proposed to understand the evolution of the sector in the coming years. The main results indicate that the national GDP, exports, and financing have a direct impact on the growth of the agricultural sector in the long term, while in the short term, only GDP and international trade have a negative influence on the sector. On the other hand, only financing shows a direct relationship. Finally, the proposed scenarios do not offer a very encouraging prognosis given the constant abrupt variations that prevent the sector from a continued recovery, determining its sensitivity to failures in the economic system.