Book description
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.
Table of contents
- Halftitle Page
- Title Page
- Copyright
- Dedication
- Foreword
- Contents
-
1 A Primer on Dollarization
- 1.1 Introduction
- 1.2 Asset vs Currency Substitution
- 1.3 Official and Partial Dollarization
- 1.4 Measuring the Degree of Partial Dollarization
- 1.5 Causes of Dollarization
- 1.6 Dollarization and Banking Dollarization
- 1.7 A Brief History of Dollarization Around the Globe
- 1.8 Exchange Rate Regimes and Dollarization
- 2 Pros and Cons of Dollarization
- 3 What Causes Dollarization?
- 4 The Impact of Dollarization on Banking Systems
- 5 Dollarization, Financial Deepening and Financial Inclusion
- 6 Policy Interventions in Dollarized Economies
- 7 Conclusions
- References
- Index
- Footnotes
Product information
- Title: Understanding Dollarization
- Author(s):
- Release date: May 2016
- Publisher(s): De Gruyter Oldenbourg
- ISBN: 9783110434033
You might also like
book
Behavioral Economics For Dummies®
A guide to the study of how and why you really make financial decisions While classical …
book
Germs, Genes, and Bacteria: How They Influence Modern Life (Collection)
Breakthrough bioscience and its implications: 3 extraordinary boks take you to the cutting edge of biology, …
book
Escape from the Central Bank Trap, 2nd Edition
This book is about realistic solutions for the threat of zero-interest rates and excessive liquidity. Central …
book
A Profile of the Oil and Gas Industry, Second Edition
We know that the people of Mesopotamia were using crude oil as a tar for building …