Hernandez, Ivan Cely, Nathalie Gonzalez, Francisco Munoz, Ernesto Prieto, Ivan
Year of Publication:
IDB Working Paper Series IDB-WP-165
This paper examines export diversification in Ecuador in the cases of fresh cut flowers, canned tuna, palm heart, broccoli and mangoes, using the theoretical framework on pioneers and discoveries developed by Hausmann and Rodrik(2003), as well as work by Sánchez and Butler (2006) on export costs and related uncertainties. It is found that the discoveries were mainly of traditional competitive advantage, with various degrees of technology adoption. The following policy implications are derived: i) innovative mechanisms to share the costs of new discoveries must be found and intellectual property rights strengthened; ii) cooperation among industry experts needs to improve; iii) deeper collective action to promote public-private partnerships should be undertaken; iv) relevant information and knowledge should be made available to all interested parties; and v) a national-level agenda should be undertaken to increase private investment in promising sectors while promoting the creation of public goods and minimizing rent-seeking behavior.