Riesgo de insostenibilidad fiscal en desastres naturales, un caso aplicado a la economía ecuatoriana. Periodo 2000 – 2016

Abstract

The objective of this present work is to analyze the potential financial unsustainability to the Ecuadorian economy in the event of a natural disaster, by focusing on the trajectory of the public debt in light of said event. For the purpose of this study, the variables were set as the ratio of the public debt in relation to corresponding figures, Public/GPD, in each trimester during the 2000-2016 period. Additionally, this work took into account the exogenous variables due to the growth of the American economy and the registered natural disasters in that country. These figures can be found in the database of the Center of Investigation into the Epidemiological effects of natural disasters. For the simulation of the national debt a set of Autoregressive Vectors was used with exogenous variables (VAR-X). These variables allow for the simulation of various negative scenarios in regards to the public finances of Ecuador, given the occurrence of a random natural disaster. An apparatus utilizing the Fomby Method was implemented to determine the effect of grand natural disasters in the model. After implementing the simulation in the 2017-2018 period the results suggests that the national debt would increase over the GPD with an average of 2.54 points in the event of a natural disaster. It is important to note that within the parameters of the study there exists an increase in the national fiscal debt, an increase in inflation and of course an increase in the interest rate on indebtedness of the Ecuadorian government.