Inflation rate of 14–16% is fair for the sub-Saharan African dollarization

Ibrahim Raheem

Journal of Economics and Finance, 2018, vol. 42, issue 4, No 8, 779-794

Abstract: Abstract This study contributes to the literature by extending the argument of the theoretical underpinning of dollarization. While the earlier studies have identified inflation, inter alia, as the important determinant of dollarization, it is silent about the exact inflation rate that is conducive for the dollarized economies. Using threshold autoregressive model, results show that inflation rate of 14–16% is favorable for the economies. Any further increment, beyond this level, would magnify the incidence of dollarization and vice-versa. Results are consistent to some robustness checks. Policy implications were suggested based upon the results estimated.

Keywords: Dollarization; Inflation; Threshold autoregressive; And sub-Saharan Africa (search for similar items in EconPapers)
JEL-codes: E3 E5 F45 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://link.springer.com/10.1007/s12197-017-9421-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:spr:jecfin:v:42:y:2018:i:4:d:10.1007_s12197-017-9421-y

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/12197/PS2

DOI: 10.1007/s12197-017-9421-y

Access Statistics for this article

Journal of Economics and Finance is currently edited by James Payne

More articles in Journal of Economics and Finance from Springer, Academy of Economics and Finance Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().