The understanding of development in Ecuador through institutions and beliefs, 1950-2014

University essay from Lunds universitet/Ekonomisk-historiska institutionen

Abstract: This thesis analyzes Ecuadorian development through a historical perspective, in which the changes related to institutions and beliefs are crucial for the explanation of their dramatic transformation. In this respect, during most of its history Ecuador was characterized for lack of leadership, high external dependence, corruption, selfish interests of groups of power, and huge instability. Indeed, their weak institutions were considered the major cause of its backwardness, since certain beliefs and customs hindered the incentives for institutional change. However, since 2007 Ecuador broke away from its past. That is, this country entered into a new development path towards a more open society in economic and political terms. The 'analytic narratives' methodology found support for institutional change process based on the emergence of a window of opportunity, the strong presence of a leader and the consequent establishment of a solid constitutional process. As a consequence, some indicators demonstrate the significance of these changes, such as: increases in economic growth rate and social spending and decreases in unemployment, poverty and inequality. Lastly, the evolution of certain customs and beliefs in favor of social welfare and national progress largely support the beginning of a new trajectory towards a more open society.

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