Financial dollarization and de-dollarization in the new millennium

Eduardo Levy Yeyati

No 19460, Documentos de trabajo from FLAR

Abstract: Dollarization, in its many variants, is crucial to understanding Latin American macroeconomics, as well as that of many developing countries. This paper builds a new updated dataset on dollarization, reviews its evolution in Latin America since 2000, and summarizes the lessons learned from several de-dollarizing attempts in the region, based on a three-way taxonomy: 1) attempts that focus on the macroeconomic drivers, 2) microeconomic measures that deter investors from dollarizing their financial assets and liabilities based on market incentives or regulatory limits, and 3) regulations that affect the choice of foreign currency as a means of payment or a unit of account. The study provides examples using seven cases that may be considered paradigmatic of the different dollarization varieties: Bolivia, Peru, Uruguay, Costa Rica, El Salvador, Ecuador and Venezuela.

Pages: 69
Date: 2021-01-29
New Economics Papers: this item is included in nep-isf, nep-lam and nep-pay
References: View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Working Paper: Financial dollarization and de-dollarization in the new milennium (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000566:019460

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