How Does Dollarization Affect Real Volatility and Country Risk?

Jorge Carrera, Mariano Feliz and Demian Panigo ()
Additional contact information
Mariano Feliz: CACES, UBA - PIETTE, CONICET- UNLP

Económica, 2000, vol. XLVI, issue 2, 73-136

Abstract: This study gives a non-traditional framework for the evaluation of an asymmetric monetary association (such as dollarization). We discuss the relationship between real volatility and country risk and determine the necessary conditions for dollarization to improve social welfare. We concentrate in two main aspects: 1) the degree of synchronization between the cycle of the leader and associated country, and 2) the effect and relative importance of the trade and financial channels. The cyclical correlation is calculated from different methodologies and the effect and size of the channels are extracted from the impulse-response functions and variance descompositions of a VEC Model. We apply our analytical framework to Argentina.

JEL-codes: C5 F3 (search for similar items in EconPapers)
Date: 2000
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.depeco.econo.unlp.edu.ar/economica/ing/ ... p?param=11&param2=55 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:lap:journl:514

Access Statistics for this article

More articles in Económica from Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata Contact information at EDIRC.
Bibliographic data for series maintained by Milagros Cejas ().