Money and Credit Under Currency Substitution

Carlos Alfredo Rodríguez
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Carlos Alfredo Rodríguez: International Monetary Fund
Authors registered in the RePEc Author Service: Carlos Alfredo Rodríguez

IMF Staff Papers, 1993, vol. 40, issue 2, 414-426

Abstract: This paper examines the effects of a repatriation of foreign assets in an economy subject to currency substitution. In the absence of 100 percent reserve requirements, a change in the location of deposits that is not compensated by an increase in money demand induces a credit boom that works itself out through a transitory current account deficit and real currency appreciation. These results are illustrated with data from recent experiences in Argentina and Peru, where local banks have been authorized to capture dollar deposits from residents.

JEL-codes: E51 F32 (search for similar items in EconPapers)
Date: 1993
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Citations: View citations in EconPapers (4)

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Working Paper: Money and Credit Under Currency Substitution (1992)
Working Paper: Money and Credit Under Currency Substitution (1992)
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