La dollarisation intégrale: une option monétaire de dernier ressort pour l'Amérique latine ?

Alexandre Minda
Authors registered in the RePEc Author Service: Alexandre Minda and Alexandre MINDA

Mondes en développement, 2005, vol. 130, issue 2, 15-39

Abstract: This article will examine the question of complete dollarization in Latin America. Because of the opportunity cost of dollarization, replacing a national currency with a foreign currency is a solution of last resort to the financial instability of Latin American economies. To clarify the discussion, a typology of dollarization regimes is drawn up in order to make an inventory of officially dollarized countries and territories. To determine what is at stake in such decisions, advantage cost analysis mentions, first of all, the expected benefits highlighted by the advocates of full dollarization. An examination of its potential impact will then allow us to evaluate the induced costs of the disappearance of national currencies. Finally, by looking at Latin American countries which have selected this monetary option, the limits of adopting such a solution are mentioned, particularly by the fact that the disappearance of national currencies leads to the loss of a powerful symbol of national identity.

Keywords: Full dollarization; Latin America; exchange rate regime; monetary (search for similar items in EconPapers)
Date: 2005
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