Economy Each of Ecuador's ecological regions has a distinctive economic base and has experienced a distinctive economic history. The sierra economy continues to be directly or indirectly based on agriculture, primarily subsistence production for domestic use. Typical crops are corn, potatoes, wheat, and barley. On the high grassy pastures sheep and cattle are also raised to supply the urban markets with meat. The most significant problem in agriculture is that of the uneven distribution of land.
Farms are either too large or too small.
The only manufacturing industy in the sierra is the remnant of the so-called Panama hat industry in the city of Cuenca. It uses palms brought from the southern coast. The textile industry of Quito and other towns of the highlands was destroyed by competition from British imports in the 19th century. For this reason persons who abandon farming in the sierra have few alternative employment opportunities. They thus tend to migrate directly out of the central region to seek their fortune on the coast.