Currency Substitution in a De-dollarizing Economy
Author | : |
Publisher | : |
Total Pages | : 38 |
Release | : 2007 |
Genre | : |
ISBN | : 9789524628525 |
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Author | : |
Publisher | : |
Total Pages | : 38 |
Release | : 2007 |
Genre | : |
ISBN | : 9789524628525 |
Author | : Eduardo Levy Yeyati |
Publisher | : MIT Press |
Total Pages | : 364 |
Release | : 2003 |
Genre | : Business & Economics |
ISBN | : 9780262122504 |
Theoretical and empirical analysis of de jure dollarization. With the persistent instability of international financial markets, emerging economies are exploring new ways to reduce exposure to capital flow volatility. Some analysts argue that financially open economies are best served by more flexible regimes, while others argue in favor of extreme exchange rate regimes that have a strong commitment to a fixed parity or dispense with an independent currency. The successful launch of the euro has made more realistic the prospect of replacing a national currency with a strong foreign one. Recent examples include the adoption of the US dollar by Ecuador and El Salvador. The introduction of a foreign currency as sole legal tender, termed full (de jure) dollarization, has been the center of much political and academic debate. This book provides a comprehensive analysis of the issues from both theoretical and empirical perspectives. The topics discussed include the role of balance sheet effects, the linkage between currency risk and country risk, the impact of dollarization on trade, financial integration and credibility, the implications of dollarization for the lender of last resort, and the institutional and political economy aspects of dollarization.
Author | : Dominick Salvatore |
Publisher | : Oxford University Press, USA |
Total Pages | : 491 |
Release | : 2003 |
Genre | : Business & Economics |
ISBN | : 019515536X |
This book takes a global approach to one of today's most controversial topics in business: Dollarization. With the collapse of the former Soviet Union, and the formation of the Euro in Europe, many countries are debating whether or not a common currency is in their best interest. This intriguing volume brings together the leading participants in the current dollarization debates.
Author | : International Monetary Fund |
Publisher | : International Monetary Fund |
Total Pages | : 50 |
Release | : 2003-09-30 |
Genre | : Business & Economics |
ISBN | : 9781589061897 |
This study examines the challenges and issues facing policymakers in highly dollarized economies. Focusing on Cambodia, which achieved almost complete dollarization during 1991-95, the authors review recent developments in the literature on dollarization and examine the costs and benefits of dollarization in Cambodia, including the ensuing macroeconomic policy implications. They carry out an econometric estimation of cash foreign currency circulation in Cambodia in order to gauge the degree of dollarization. In addition to this analysis, the authors present a short description of Cambodia’s economic, financial, and structural background.
Author | : Guillermo A. Calvo |
Publisher | : |
Total Pages | : 46 |
Release | : 1992 |
Genre | : Circular velocity of money |
ISBN | : |
Author | : Emre Ozsoz |
Publisher | : Walter de Gruyter GmbH & Co KG |
Total Pages | : 140 |
Release | : 2016-05-24 |
Genre | : Business & Economics |
ISBN | : 3110437023 |
A very commonly observed phenomenon in developing and emerging market economies is the use of another country’s currency (whether the US dollar or another currency) in lieu or in addition to the local currency. The most common type of this financial phenomenon is partial (de facto) dollarization where foreign currencies are used side by side with local currency for saving and borrowing purposes in addition to serving as medium of exchange. Governments in these countries have been encouraging dollarization for years by allowing their citizens to save and borrow from local banks in foreign currency. Yet the existence of multiple currencies on banks' balance sheets on both the asset and liability side poses risks to the health and stability of the banking system. This book evaluates the practical aspects of partial dollarization in countries such as Turkey, South Korea, Peru, and Cambodia among others. Starting with the origins of the phenomenon, the impact on banking systems and financial depth of the credit markets are discussed along with risks to the banking systems. Challenges faced by Central Banks and banking regulators are evaluated using recent country studies.
Author | : Mr.Luis Catão |
Publisher | : International Monetary Fund |
Total Pages | : 25 |
Release | : 2016-08-16 |
Genre | : Business & Economics |
ISBN | : 1475525761 |
We re-appraise the cross-country evidence on the dollarization of financial systems in emerging market economies. Amidst striking heterogeneity of patterns across regions, we identify a broad global trend towards financial sector de-dollarization from the early 2000s to the eve of the global financial crisis of 2008–09. Since then, de-dollarization has broadly stalled or even reversed in many economies. Yet a few of them have continued to de-dollarize. This suggests that domestic factors are also important and interact with global factors. To gain insight into such an interaction, we examine the experience of Peru since the early 1990s and find that low global interest rates, low global risk-aversion, and high commodity prices have fostered de-dollarization. Domestic macro-prudential measures that raise the relative cost of domestic dollar loans and the introduction and adherence to inflation targeting have also been key.
Author | : Ms.Ratna Sahay |
Publisher | : International Monetary Fund |
Total Pages | : 34 |
Release | : 1995-09-01 |
Genre | : Business & Economics |
ISBN | : 145195008X |
After most restrictions on foreign currency holdings were relaxed in the early 1990s, foreign currency deposits in transition economies have been increasing rapidly. This paper takes a first look at the evidence on dollarization for 15 transition economies, and then discusses some key conceptual and policy implications. Depending on the institutional constraints, foreign currency deposits as a proportion of broad money reached a peak of between 30 and 60 percent in 1992-93. Unlike what has been observed in Latin America, however, dollarization has fallen substantially in the aftermath of successful stabilization plans in Estonia, Lithuania, Mongolia, and Poland. Since foreign currency deposits reflect mainly a portfolio choice, the fall in dollarization can be primarily attributed to higher real returns on domestic-currency assets, as a result of lower inflation and more market-determined interest rates.
Author | : A. Armas |
Publisher | : Springer |
Total Pages | : 349 |
Release | : 2006-07-14 |
Genre | : Business & Economics |
ISBN | : 0230380255 |
This volume provides a rigorous and balanced perspective on the causes and implications of dollarization, and the basic policies and options to deal with it: the adaptation of the monetary and prudential frameworks, the development of local-currency substitutes, and the scope for limiting dollarization through administrative restrictions.
Author | : Koji Kubo |
Publisher | : Springer |
Total Pages | : 255 |
Release | : 2017-09-01 |
Genre | : Business & Economics |
ISBN | : 3319577689 |
This book sheds light on the dollarization trends of four transitional economies in Southeast Asia: Cambodia, Lao PDR, Myanmar, and Vietnam. Moving beyond the tendency to focus on the Latin American experience of dollarization and prolonged high inflation, the chapters in this book compare how payment dollarization has been more persistent than other types of dollarization in this region due to network externalities. The book illustrates that dollarization started in the underdeveloped financial system in these countries and that dollarization interacted with financial development, which is in contrast to dollarization in Latin America. This project extends the frontiers of empirical studies on dollarization. It will be of interest to students, researchers and policy makers concerned with dollarization and economics in Southeast Asia.