Regional Inflation and Financial Dollarization

Martin Brown, Ralph De Haas and Vladimir Sokolov (vsokolov@hse.ru)

No 1327, Working Papers on Finance from University of St. Gallen, School of Finance

Abstract: We exploit variation in consumer price inflation across 71 Russian regions to examine the relationship between the perceived stability of the local currency and financial dollarization. Our results show that regions with higher inflation experience an increase in the dollarization of household deposits and a decrease in the dollarization of (long-term) household credit. The negative impact of inflation on credit dollarization is weaker in regions with less-integrated banking markets, suggesting that the asset-liability management of banks constrains the currency-portfolio choices of households.

Keywords: Financial dollarization; financial integration; regional inflation (search for similar items in EconPapers)
JEL-codes: E31 E42 E44 F36 G21 P22 P24 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2013-11
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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http://ux-tauri.unisg.ch/RePEc/usg/sfwpfi/WPF-1327.pdf (application/pdf)

Related works:
Working Paper: Regional Inflation and Financial Dollarization (2015)
Working Paper: Regional Inflation and Financial Dollarization (2013)
Working Paper: Regional Inflation and Financial Dollarization (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:usg:sfwpfi:2013:27

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