The role of internal, external prices and the exchange rate in the production of the colombian coffee sector in the period 2000-2016

This article is part of a research project that covers the agricultural subsectors in Colombia of: rice, coffee, sugar cane, paper, cocoa and cattle. This article develops a theoretical framework on the formation of prices and the exchange rate in relation to production decisions in the coffee sector and; as well as the state of the art on the problem of the sector. A theoretical framework was developed on the formation of prices and their relationship with the markets for agricultural products and the role of exchange rates in the trade balance; as well as the state of the art on the problem in the agricultural sector with emphasis on Latin American countries; a descriptive and correlational analysis of the behavior of the coffee sector of the Colombian economy in the analysis period was carried out and finally the construction of econometric models is carried out in order to develop the objectives and contrast the hypotheses.

The methodology used is that of panel data models, with the estimation by fixed, random and dynamic effects, with which it was determined that coffee production is impacted by changes in exports and the exchange rate.