Redistribution or Illusion? –A closer look at Ecuador’s Economic Policies during Correa’s Citizen Revolution

Yixiao (Carl) Cao ’22 and Professor Esteban Argudo (Economics Department)

This summer, I worked with Professor Argudo and Anish Kumthekar ’22 to assess the impact of the redistributive policies implemented in Ecuador under Rafael Correa’s Citizen Revolution (2009-2013). The main focus in the past two months is to collect and examine the data to get a comprehensive and quantitative understanding of the socio-economic progress in Ecuador during the period of interest. 

As the graph demonstrates, the sampling of each period varies. We’ve identified three major changes:

  1. March and September surveys pre-2014 only cover urban areas, while post-2014 all the surveys include both urban and rural areas
  2. The Galapagos Islands are included since 2014
  3. There’s a major sampling expansion in 2014.

The first two could be dealt with easily through some cleaning, however, the third one is of major concern.

We used diff-in-diffs regressions to check if the sampling change (i.e. the “treatment”) has caused any variations in the demographic representation of the survey. We found the parallel control assumption to be held in pre-treatment periods for both income (ingrl) and age (p03) :






Then we ran the regression and found a significant coefficient (p-value = 0.033) on the interaction term. This suggests that the sampling expansion in 2014 is causing variations in the representation of the survey and has to be controlled for in our future analysis.

Besides the data analysis work, we also read papers about the HANK model and the Ecuadorian economy. This project helped me learn how to think about and approach research questions independently and critically, as well as gain valuable skills in R and Python programming. For the rest of the summer and next semester, we will continue to do formal analysis on the data, build the model, calibrate it with the data, and finally evaluate the impact of the economic policies.

(credit: Yixiao (Carl) Cao; from top left: Anish Kumthekar’22, Yixiao (Carl) Cao’22, Professor Esteban Argudo)

(credit: Yixiao (Carl) Cao; Carl and Anish working together on a debugging process)