Journal of Business and entrepreneurial
January - March Vol. 7 - 1 - 2023
http://journalbusinesses.com/index.php/revista
e-ISSN: 2576-0971
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The contribution of migrant enterprises and
businesses in Ecuador's economic history
El aporte de emprendimientos y empresas de migrantes en
la historia económica del Ecuador
Elizabeth Arias Domínguez
*
Dayanara Lilieth Arias Navarrete
*
Danielys María Hernández Bernay
*
Gián Sebastián Rodríguez Villamar
*
ABSTRACT
The objective of this article is to make known the social
and economic impact of migrants in Ecuador, through the
study of bibliographic material from official sources and
surveys conducted to compare the migratory and
entrepreneurial reality in the country with international
statistics that have the purpose of providing an amplified
vision of the importance that this type of entrepreneurship
has in Ecuadorian territory. Entrepreneurship has emerged
as an alternative to carry out commercial activities by
people who have creative and innovative ideas, nowadays
it has become more frequent since it provides autonomy
to entrepreneurs and the opportunity to implement
projects to ensure their welfare and professional growth.
Migrants usually have an entrepreneurial attitude due to
the firm intention of improving their quality of life. In the
development of this project, it can be observed that most
of the migrants in Ecuador are of Venezuelan nationality,
who were motivated to become entrepreneurs due to the
lack of employment or jobs with insufficient salaries. Based
on the data collected from the sources consulted, it was
possible to make a comparison between the levels of
* Master's degree, Instituto Superior Universitario Bolivariano de
Tecnologías, Bolivarian University of Ecuador ecarias2@itb.edu.ec,
https://orcid.org/0000-0002-5329-6429
* C.P.A. Instituto Superior Universitario Bolivariano de Tecnologías
dlarias@itb.edu.ec, https://orcid.org/0000-0002-6674-9300
* C.P.A. Instituto Superior Universitario Bolivariano de Tecnologías
dmhernandez@itb.edu.ec, https://orcid.org/0000-0001-7164-3212
* C.P.A. Instituto Superior Universitario Bolivariano de Tecnologías
gsrodriguez2@itb.edu.ec, https://orcid.org/0000-0002-7518-0769
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education, where they highlight levels of study ranging
between second and third level, showing an inclination to
have a good academic preparation.
Keywords: Migration, Entrepreneurship, Immigrants,
Employment, Economy.
RESUMEN
El objetivo de este artículo es dar a conocer el impacto
social y económico que aportan los migrantes en Ecuador,
mediante el estudio de material bibliográfico de fuentes
oficiales y encuestas realizadas para comparar la realidad
migratoria y emprendedora en el país con estadísticas
internacionales que tienen el fin de aportar una visión
amplificada sobre la importancia que este tipo de
emprendimiento tienen en el territorio ecuatoriano. El
emprendimiento ha surgido como una alternativa para
realizar actividades comerciales por parte de personas que
tienen ideas creativas e innovadoras, en la actualidad se ha
hecho más frecuente ya que le brinda autonomía a los
emprendedores y la oportunidad de poner en marcha
proyectos para garantizar su bienestar y crecimiento
profesional. Los migrantes normalmente tienen una actitud
emprendedora debido a la firme intención de mejorar su
calidad de vida. En el desarrollo de este proyecto, se puede
observar que la mayoría de los migrantes en Ecuador son
de nacionalidad venezolana, quienes se vieron motivados a
emprender debido a la falta empleo o trabajos con sueldos
insuficientes. Con base en los datos recopilados de las
fuentes consultadas, se pudo realizar una comparación
entre los grados de educación donde resaltan niveles de
estudio que oscilan entre segundo y tercer nivel,
mostrando una inclinación a contar con una buena
preparación académica.
Palabras clave: Migración, Emprendimiento, Inmigrantes,
Empleo, Economía.
INTRODUCTION
Throughout history, different mass exoduses of certain populations have been observed
as a consequence of economic, political or social conflicts. Latin America has always been
a territory strongly affected by governments that have not been beneficial for the stability
of the countries. Particularly in the case of Venezuela, a political conflict has generated
the mobilization of a large number of people in search of a better quality of life.
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People continue to leave Venezuela to flee violence, insecurity, threats, lack of food,
medicine and essential services. With more than 6 million refugees and migrants from
Venezuela - the majority of whom live in Latin American and Caribbean countries - this
has become the second largest external displacement crisis in the world.(United Nations
High Commissioner for Refugees, n.d.)
Ecuador is one of the countries in Latin America that welcomes a large number of
Venezuelans, due to the accessibility of the Andean country for the arrival of migrants
thanks to its proximity. As mentioned by Orbegoso (2019): "As of November 2019,
according to UNHCR, more than 4.6 million people have left the country and 80% of
them are in other Latin American countries". In addition to these data, it is estimated
that the countries that have presented the greatest entry of Venezuelan citizens are
Colombia, Peru and Ecuador, the latter having received 385,000 Venezuelan migrants
for 2019 according to data established by the ANCUR(Orbegoso, 2019).
The governments of the main Latin American countries where Venezuelan migration
arrives have implemented measures that seek the regularization of migrants so that they
can integrate into society and develop economically and professionally; thanks to this
more than 2 million temporary and permanent permits have been granted since 2015
between the different countries, thus allowing stabilization and development
opportunities for migrants (Chang, 2020).
In the case of Ecuador specifically, within the different options of visas and temporary
and permanent residences, around 107,000 residences had been issued by 2019 (Chang,
2020). Providing regularization to migrants who have professional training, knowledge
and experience in different areas can become a booster for the economy of Ecuador
thanks to the implementation of enterprises that provide jobs and profits for the country
through the payment of taxes. As determined by the authors Arevalo and Arevalo
(2015):
Entrepreneurship as a social and business phenomenon has revolutionized the
conception of new business in today's world. Entrepreneurial activity is now a vital
component of national and regional economic growth and development, since it fosters
innovation, job creation and improves the global competitiveness of companies and
entire countries (p. 28).
For immigrants, an entrepreneurial culture is represented by the determination towards
the future and success, to overcome and move forward, as well as to face risks and
uncertainties; they are eager to start different projects in a different country, where
customs are different and in some cases also the language. They are willing to sacrifice
in order to get their families out of the crisis or simply to give them a better quality of
life and greater peace of mind.
According to articles in the newspaper El Universo (2021)(2022)In Ecuador, alliances
and programs for social and economic inclusion have been created by the United
Nations Agency for Refugees (UNHCR) and entities such as the International Labor
Organization (ILO) and the Economic Promotion Agency of the Metropolitan District
of Quito (ConQuito), alleging the legal, administrative and social difficulties that migrants
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have to be placed in decent jobs, since their opportunities are usually in the informal
sector where their rights are not usually respected.
International support has also been present to support the skills and ideas of migrants
in Ecuador, thanks to countries such as South Korea, who through the project "creating
opportunities for prosperity" in conjunction with the Export and Investment Promotion
Corporation (Corpei) provided their collaboration to grant up to USD $2,600 in 2022
to 120 ventures of Venezuelan migrants legally residing in Ecuador. "The enterprises
belong to the food, childcare, beauty, footwear, commerce, decoration, carpentry,
education, industry, advertising, health, services, technology, textile, tourism and
veterinary sectors" (El Universo, 2022). (El Universo, 2022).
The conditions of migrants are not always similar; there is a part of the migrant
population that does not have the same opportunities, either due to lack of resources
or lack of professional training, which leads them to resort to informal jobs. According
to Bravo, Serrano and Serrano (2021):
Since the presence of Venezuelans in the streets, informal businesses have undergone
changes, and new businesses are constantly being observed in the streets and avenues
or the growth of those that already existed. Street businesses predominate in populated
areas, but the control and tax agencies remain as spectators, trying to ensure that their
competencies do not negatively influence these sensitive productive survival options
(p.63).
As mentioned by Serrano, Bravo and Serrano (2021) in the country there are laws that
support informal businesses according to the 2008 constitution, in which article 183
alleges the implementation of a social and solidarity-based economic system. In addition,
the entities responsible for monitoring and regulating these businesses have provided
some flexibility and leniency to them, in order to support the productivity and
microeconomy of citizens (p. 63).
Jaramillo and Rodriguez (2019) mention "given the limited supply of employment, many
people choose to engage in informal activities or sales in order to meet daily needs, such
activities are witnessed daily in the bay sector of the city of Guayaquil" (p.2).
However, those who are able to formally incorporate their businesses or ventures
usually make a positive contribution to the community and the local economy. Ganán
(2019) states "the immigrant entrepreneur is not affected by the situation of the
destination country. Faced with an economic crisis, immigrants do not consider the
possibility of closing their businesses; rather, they look for new ways to keep it open"
(p.21).
Serrano, Bravo and Serrano (2021) describe entrepreneurship as the attitude of people
to take advantage of their qualities to surpass themselves in spite of the adversities they
may face. Entrepreneurship has been described as a person's ability to move forward in
a new way and with renewed ideas (p.61).
A determining factor for success in business ventures is to maintain a good relationship
with customers, adjusting to their needs; likewise, a good service at the time of selling
is relevant. It is important to point out that there are risks involved in entrepreneurship,
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since, being new in the market, it is necessary to achieve a position in it, gaining the
customer's trust and offering a quality service or product, which helps to overcome
adversities and move forward with the projects.
According to the author Siguencia (2010) migrants who have ventures normally carry
out previous studies to avoid failures or failures. They implement a corporate culture
where there is determination to achieve their objectives, fulfilling the necessary activities
or tasks without setting limitations (p.34).
Ecuador is a country with abundant natural resources, which despite being in the process
of development and maintaining economic and social setbacks, is an attractive
destination for migrants from other Latin American countries, according to Arévalo and
Arévalo (2015) "the country has become a preferred destination mainly for Colombian,
Peruvian and Cuban citizens" (p.39).
Different economic events have taken place in the course of Ecuador's history, taking it
into account and relating to it helps to create solutions to economic problems that exist
today. Another important aspect is to learn from the solutions of similar negative
situations in different parts of the world. In this sense, Acosta (2006) argues that:
Thus, since its origins, the economy of the Republic of Ecuador has gone through a series
of periods of boom and crisis, closely linked to the cycles of the central capitalist
economies; a link that is not limited simply to economic relations, but is completed with
all the elements - political, social, cultural - that make up world power. This complex
process gained strength as the capitalist system consolidated and spread and the
Ecuadorian economy became integrated into world trade (p.15).
It is important, then, to know the economic background of Ecuador, and its economic
history as a recipient of population from other countries, and from the other
perspective, to recognize that many Ecuadorians have also been forced to migrate to
other parts of the world for different factors, or to move internally from towns to cities.
This phenomenon began decades ago, as explained by Cáceres and Guzmán (2018):
"however, in the Inca and colonial times people had to leave the lands due to conquests,
wars of independence, catastrophes, epidemics or other events that generate the
transfer of people from one place to another" (p.19).
Acosta (2006) also explains that during the transformation of Ecuador from a colony to
a Republic, multiple wars were fought in order to achieve independence, in this period
Ecuador ended up becoming a base that supported the necessary resources for the war,
being these war events the first articulations with the world economy due to the
external debt that they cause. At the same time, based on the export of primary
products such as cocoa, Ecuador began to integrate into the world market with a great
influence on the English market, after independence from Spain, the Ecuadorian economy
presented few changes (pp.23-24).
Couple (1992) argues that during 1920, with the fall of the New York stock market,
there was a decrease in the price of cocoa, causing a long-term economic collapse.
During the course of 1937, Ecuador was able to have a slow recovery in exports until
1944, when it reached incomes similar to those obtained before the crisis. At the end
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of 1972, Ecuador incorporated oil into its exports, which meant an increasing rise in
exports and during 1973 accelerated the socioeconomic evolution of the country,
causing a significant modernization (pp.4-7).
Another important economic event in Ecuador's history according to Salgado
(2000)Another important economic event in Ecuadorian history, according to Salgado
(2000), took place in the last decade of the twentieth century, when a strong devaluation
of the official currency at that time took place in Ecuador, generating multimillionaire
economic losses in the international monetary reserves. These events caused the
consequent bankruptcy of national banks that gave way to the event known as the
national holiday, which would later serve as a basis for encouraging the country to carry
out the dollarization process (p.9).
Clavijo (2022) points out that in the nineties in countries such as Ecuador and Venezuela,
there were several damaging events that as a consequence originated a great period of
instability that touched different important areas for their good development (p.19). The
national holiday was one of these events in Ecuador and was the immediate propellant
for a large number of Ecuadorians to emigrate to other countries, mainly Spain and the
United States, in search of economic sustainability.
Some Ecuadorian migrants who have returned to their native country, have seen in
entrepreneurship a good option to invest part of their savings, in some cases support
has been provided by organizations but, despite this, there are deficiencies in such aid
and in many cases do not fully meet the different needs of entrepreneurs, as noted in an
article in the newspaper El Comercio: "Diego Proaño, economic analyst of Tungurahua,
says that few businesses are maintained due to the pandemic and the lack of professional
advice and training" (Moreta, 2022). (Moreta, 2022)
Ecuador, due to its foreign relations and exports of its natural resources, has been able
to experience various moments of boom in the world market that have contributed
positively to the country's economy, but, just as these relations have provided different
economic benefits in the past, there have also been mismanagement of these resources
that have prevented the progress that Ecuador deserves, especially for its characteristics
and natural potential, coupled with the little creation of technology that keeps it as an
exporter of primary products without achieving the much desired value added to its
international sales.
As mentioned, Ecuador has been a country with different historical events, even from
times prior to its beginnings as a Republic, which in some cases have harmed and in
others have helped the country economically. Migration as a constant phenomenon in
its history has made it possible to bring resources to Ecuadorian territory by the
population that has migrated and continues to migrate to other territories. Ecuador, as
a recipient of people of other nationalities, shows solidarity with the problems that
caused their arrival and makes possible the creation of new enterprises of this group
through state support with financing, considering them a vulnerable group.
An example of accompaniment in this context is the Development Corporation of
Ambato (CorpoAmbato), which is an organization that has provided support to migrant
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and Ecuadorian enterprises, as mentioned in the newspaper El Comercio "this
organization works with 35 enterprises that are working. Seventy percent are
Ecuadorian and the remaining 30 percent are foreigners" (Moreta, 2022).
For Loja, Nugra and Rivera (2020) the city of Cuenca, capital of the province of Azuay,
turns out to be a promising city for the development of migrant enterprises, firstly
because it is a city that offers better conditions in terms of basic services and security,
in addition to the existence of a culture that gives greater relevance to the inclusion of
new social perspectives and the implementation of municipal instances such as La Casa
del Migrante (p.156).
Although Ecuador is a country that still has certain economic, political and social
difficulties, which undoubtedly must be addressed and solved as soon as possible to
ensure the welfare of the Ecuadorian population, the Andean country remains a noble
country, full of natural wealth and valuable people, where despite the setbacks, it is
allowed through work, effort and dedication, to stay on the road to achieving personal
and professional goals to those who are in it.
MATERIALS AND METHODS
This research work was carried out by means of a survey of 255 entrepreneurs in the
city of Guayaquil in November 2022, to review data on the percentage of migrants in
this type of economic activity and specific characteristics that can be compared with
other international statistics in order to establish similarities, differences and trends
regarding this important topic.
The type of research to which it belongs is descriptive documentary because it is based
on the consultation of documents where the necessary information is collected and in
turn is responsible for detailing the quality of the population being considered, it is also
established as qualitative and quantitative because comparisons are made of the
nationalities of different countries that undertake in the country Ecuador, where surveys
were conducted to a sample of people called entrepreneurs, from which data were
obtained with which we proceed to the tabulation and analysis of results. It can also be
established as a field research since at the time of obtaining the results of the surveys,
the researchers went to the establishments of the entrepreneurs surveyed.
RESULTS
It is possible to observe the participation in percentages by nationality of the
entrepreneurs surveyed in the field work carried out by the authors, highlighting a
majority value of 89% of local people, followed by the participation of Venezuelan
entrepreneurs with 5.88%.
The percentage that generally defines the level of education attained by the migrants
surveyed in the fieldwork carried out by the researchers is represented, in which it is
notorious that the majority have completed a third level of higher education, with a
percentage of 39%, followed by secondary education with 29%. The percentage of formal
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and informal enterprises of each of the nationalities belonging to the migrants surveyed
in the fieldwork, where it stands out that Venezuelan migrants maintain mostly formal
enterprises, while the Mexican and Argentinean migrants surveyed only manage formal
enterprises, The number of collaborators that the surveyed migrants have in their
enterprises in general, highlighting that most of the migrant entrepreneurs do not have
collaborators with 29%, followed by a very close percentage of 25% that indicate that
they have two collaborators in their enterprises. The percentage that corresponds to
the classification of the enterprises of the migrants surveyed in a general manner in the
fieldwork, according to which it can be observed that marketing stands out as the main
means for migrant entrepreneurship, followed by the elaboration and sale of products.
The percentage of migrant entrepreneurs surveyed who have received credit or
financing for the establishment of their projects is shown, highlighting their nationalities,
with 100% affirmative for the Argentinean population surveyed and 100% negative for
the Mexican population surveyed, The fundamental motivations for the migrants
surveyed, regardless of their nationality, to carry out their entrepreneurship, in which
the main reason for entrepreneurship is to have a creative and lucrative idea, followed
by low income with a percentage of 32%, followed by low income with a percentage of
25%. The percentages of migrants surveyed in general who have or have not received
some type of training to strengthen their knowledge regarding the management of their
enterprises, where it is shown that the majority, with a percentage of 61%, indicate that
they have not received such training.
The different percentages of Venezuelan migration in the main host countries, where it
can be observed that the mobilization of Venezuelan migrants has taken place mainly
within Latin American countries, Colombia being the first with 33.83%, followed by Peru
with a percentage of 21.02%, the migratory situation of Venezuelans in Ecuador can be
observed represented in percentages, in which it is reflected that there is a high
percentage of Venezuelan migrants who at the date of this study were in an irregular
migratory situation, with 44%. However, it also stands out that there is a percentage of
36% of migrants who are in a regular temporary situation, the level of studies completed
by Venezuelan migrants with potential to be included in the labor market, where it is
observed that a higher percentage of migrants with 43% have completed their studies
up to secondary school level, while 28% have university level studies, A comparison
between the labor situation in Venezuela and Ecuador of the migrants in the study
mentioned by the ILO, where it is highlighted that most Venezuelan migrants in Ecuador
are unemployed, even in a higher percentage than when they were in their native
country, hence the other important values in their labor situation in Ecuador are as
informal workers 20% and self-employed 17%.
According to the results obtained from the surveys conducted among a sample of the
entrepreneurial population of the city of Guayaquil, Ecuador, and the statistics provided
by the international sources investigated, it is possible to determine certain relationships
between these statistics. In the aspect of Venezuelan migration, there is clearly a greater
mobilization of migrants to nearby Latin American countries, with Ecuador in third place,
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and therefore it is a country that has received a large number of migrants from that
country. This coincides with part of the results of the surveys, since of all the migrant
entrepreneurs surveyed, the majority are Venezuelan, followed by Colombians and
Chinese.
Of the Venezuelan population in Ecuador, studies from the year 2020 indicate that most
of them were in an irregular situation, which to a large extent is an impediment to finding
jobs with good opportunities for growth and personal improvement. In this context it
is also important to mention that during the year 2022 a new regularization plan for
Venezuelans and other migrants began, which will be a great benefit to have a solid
migratory situation with the opportunity to carry out different projects.
As can be seen in the results of the surveyed population, migrants have a greater
tendency to formalize their enterprises, which is something positive for the country, as
it contributes to the contribution of taxes and possible employment opportunities with
benefits for other citizens, as is also reflected in the results obtained, where despite the
fact that most of the respondents indicated that they did not have collaborators in their
enterprise, a significant percentage in second place emphasizes that they have two
collaborators. In this order of ideas, the majority of the surveyed migrant population
describes that a main motive for entrepreneurship is to have a creative and lucrative
idea, thus providing opportunities to carry out these businesses represents growth for
the participating individuals and for the nation.
Regarding the studies and academic preparation of the surveyed migrants, the majority
indicate that they have completed third level studies followed by finished secondary
school, being able to relate these results with information found in investigated sources,
where it is established that Venezuelan migrants likely to enter the labor market have
mostly finished secondary school and then completed third level.
These data are positive, since they favor the incursion of people academically prepared
or with a good base to continue with their professional preparation, in many cases they
also continue their studies in the national academies or institutes, generating a better
use of the Ecuadorian education.
According to information sources compiled by the ILO and shown in Figure 12, one of
the predominant labor situations in Ecuador is to maintain informal jobs without social
security, this includes both Ecuadorian citizens and foreigners, since the entire
population suffers the consequences of the labor deficit that exists in the country. For
this reason, the idea that entities should support and provide the necessary tools to
those who wish to become entrepreneurs continues to be outstanding. In graphs 6 and
8, which show whether migrant entrepreneurs have received financial loans or training,
respectively, it is clear that most migrants have not received loans from government
institutions or training, which is a limiting factor for their growth.
Valuing the innovative ideas that migrants may present and offering them support,
training and follow-up is a relevant aspect to promote their possible proposals and help
them increase the necessary knowledge for the management of any business. The growth
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of these businesses undoubtedly has an impact on the economic and social growth of
the country.
CONCLUSIONS
It can be determined that migration is a phenomenon that has taken place in different
parts of the world at multiple points in history, due to the fact that populations are
affected by economic, political and social events, these being reasons for mobilizations,
sometimes massive, in search of better opportunities and a better quality of life.
Ecuador is an attractive destination for migration because, despite its internal and
external conflicts, it is a country rich in natural resources and with multiple
opportunities; in addition, its official currency is the US Dollar, which is considered a
strong currency at an international level that provides good economic sustainability for
those who make their wealth grow.
The Andean country has not only received migrants, but also a large number of
Ecuadorian citizens were forced to migrate to other countries, due to the national
holiday caused by the extreme devaluation of the previous currency, which resulted in
the dollarization of the country.
The implementation of enterprises by migrants can bring various situations, both
negative and positive, to the country of destination. Specifically speaking of the situation
in Ecuador, changes have been seen in the streets with respect to informal
entrepreneurship resulting in street businesses that circulate in urban areas due to the
scarcity of jobs. On the positive side, many migrants arrive in the country with great
business ideas, motivated by their skills or professional preparation, being this a possible
propellant that contributes to the economy and the growth of the country, generating
jobs and income.
A large part of the migrant population in Ecuador is of Venezuelan nationality; according
to international sources investigated, it is the third country to which Venezuelans go.
Similarly, other data investigated show that Colombians and Peruvians have also decided
to migrate to Ecuador, being these migrants potential entrepreneurs.
The country considered "the center of the world" has implemented programs for the
socioeconomic inclusion of migrants by institutions such as the UNHCR and the ILO,
which have exposed the difficulties that migrants face when looking for decent work.
Programs such as the Ambato Development Corporation are a clear example of the
support that Ecuador provides to migrants so that they can undertake appropriate
projects.
Despite the aforementioned projects, as can be seen in the results obtained in the
surveys, most of the entrepreneurs, whether Ecuadorian or foreign, have not received
financing or training to manage their businesses, so it could be concluded that more
support and follow-up is needed from government agencies to provide greater support
to entrepreneurs.
Finally, comparing the international sources investigated with the results obtained in the
surveys of migrant entrepreneurs, it is possible to identify certain similarities between
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the different aspects related to entrepreneurship, such as the motivations for
entrepreneurship and their levels of study, which tend to be between second and third
level academic. These factors are important because they strengthen the positive
economic impact in Ecuador with creative entrepreneurial ideas that seek to meet the
needs of the community.
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