Dollarization of the Banking System : Good or Bad?

De Nicol� Honohan, and Ize assess the benefits and risks associated with dollarization of the banking system. The authors provide novel empirical evidence on the determinants of dollarization, its role in promoting financial development, and on whe...

Full description

Bibliographic Details
Main Authors:	De Nicolo, Gianni, Honohan, Patrick, Ize, Alain
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	ACCOUNTING ACCOUNTING STANDARDS ACTUAL COST ASSET SUBSTITUTION BALANCE SHEETS BANK DEPOSITS BANK FAILURE BANK RESERVES BANKING CRISES BANKING SYSTEM CAPITAL CONTROLS CENTRAL BANK CENTRAL BANKS CORRESPONDENT ACCOUNTS COUNTRY VARIATIONS CURRENCY BOARD CURRENCY BOARDS CURRENCY FLUCTUATION CURRENCY REGIME CURRENCY RISK CURRENCY SUBSTITUTION CURRENCY TRANSACTIONS DEBT DEMAND DEPOSITS DEPOSIT DOLLARIZATION DEPOSIT INSURANCE DEVALUATION DEVELOPING COUNTRIES DOLLAR DEPOSITS DOLLAR INDEXATION DOMESTIC CURRENCY DOMESTIC FINANCIAL SYSTEM DOMESTIC INVESTORS DOMESTIC RESIDENTS ECONOMETRIC EVIDENCE EMPIRICAL EVIDENCE EURO EXCHANGE ARRANGEMENTS EXCHANGE DEPOSITS EXCHANGE RATE EXCHANGE RATE CHANGES EXCHANGE RATE FLEXIBILITY EXCHANGE RATE PEGS EXCHANGE RATE POLICY EXCHANGE RATE REGIME EXCHANGE RATE STABILITY EXCHANGE RATES EXCHANGE RESTRICTIONS EXPROPRIATION EXTERNAL SHOCKS EXTERNALITIES FINANCIAL ASSETS FINANCIAL CONTRACTS FINANCIAL DEEPENING FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL DOLLARIZATION FINANCIAL INNOVATION FINANCIAL INSTABILITY FINANCIAL INSTRUMENTS FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIATION FINANCIAL REPRESSION FINANCIAL SECTOR FINANCIAL SYSTEM FINANCIAL SYSTEMS FOREIGN BORROWING FOREIGN CURRENCY FOREIGN CURRENCY DEPOSITS FOREIGN EXCHANGE FOREIGN EXCHANGE TRANSACTIONS FOREIGN INVESTORS GLOBALIZATION GOVERNMENT GUARANTEE GOVERNMENT INTERVENTION HIGH INFLATION HIGH PREMIUM HIGH RATES INDUSTRIAL COUNTRIES INFLATION INFLATION TARGETING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURANCE INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERNATIONAL RESERVES LEGAL PROTECTION LEGAL SYSTEM LEGAL TENDER LIQUIDATION LIQUIDITY LOANABLE FUNDS LOCAL CURRENCY LOCAL CURRENCY LOANS LONG TERM MACROECONOMIC POLICY MACROECONOMIC STABILITY MARKET RISK MATURITIES MONETARY AUTHORITIES MONETARY POLICIES MONETARY POLICY MONETARY REGIME MORAL HAZARD MUTUAL FUNDS NATIONAL AUTHORITIES NONPERFORMING LOANS OUTPUT PENSIONS POLICY AGENDA POLICY CREDIBILITY POLICY RESEARCH PORTFOLIOS PRIVATE AGENTS PRIVATE SECTOR PROBABILITY OF DEFAULT PUBLIC DEBT PUBLIC SECTOR PURCHASING POWER PURCHASING POWER PARITY REAL EXCHANGE REAL EXCHANGE RATE REAL INTEREST REAL INTEREST RATES REAL SECTOR RESERVE REQUIREMENTS RISK FACTORS RISK PREMIA SECURITIES SOLVENCY STABILIZATION STABLE EXCHANGE RATE STORE OF VALUE TAX SYSTEM TIME DEPOSITS TRANSACTION COSTS TRANSITION ECONOMIES VOLATILITY WAGES BANKING SYSTEMS DOLLARS MONETARY SYSTEMS CURRENCY MARKETS CURRENCY HOLDINGS OF FUND BANKING SYSTEMS WAGES
Online Access:	http://documents.worldbank.org/curated/en/2003/08/2495955/dollarization-banking-system-good-or-bad http://hdl.handle.net/10986/18133

id	okr-10986-18133
recordtype	oai_dc
spelling	okr-10986-181332021-04-23T14:03:41Z Dollarization of the Banking System : Good or Bad? De Nicolo, Gianni Honohan, Patrick Ize, Alain ACCOUNTING ACCOUNTING STANDARDS ACTUAL COST ASSET SUBSTITUTION BALANCE SHEETS BANK DEPOSITS BANK FAILURE BANK RESERVES BANKING CRISES BANKING SYSTEM CAPITAL CONTROLS CENTRAL BANK CENTRAL BANKS CORRESPONDENT ACCOUNTS COUNTRY VARIATIONS CURRENCY BOARD CURRENCY BOARDS CURRENCY FLUCTUATION CURRENCY REGIME CURRENCY RISK CURRENCY SUBSTITUTION CURRENCY TRANSACTIONS DEBT DEMAND DEPOSITS DEPOSIT DOLLARIZATION DEPOSIT INSURANCE DEVALUATION DEVELOPING COUNTRIES DOLLAR DEPOSITS DOLLAR INDEXATION DOMESTIC CURRENCY DOMESTIC FINANCIAL SYSTEM DOMESTIC INVESTORS DOMESTIC RESIDENTS ECONOMETRIC EVIDENCE EMPIRICAL EVIDENCE EURO EXCHANGE ARRANGEMENTS EXCHANGE DEPOSITS EXCHANGE RATE EXCHANGE RATE CHANGES EXCHANGE RATE FLEXIBILITY EXCHANGE RATE PEGS EXCHANGE RATE POLICY EXCHANGE RATE REGIME EXCHANGE RATE STABILITY EXCHANGE RATES EXCHANGE RESTRICTIONS EXPROPRIATION EXTERNAL SHOCKS EXTERNALITIES FINANCIAL ASSETS FINANCIAL CONTRACTS FINANCIAL DEEPENING FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL DOLLARIZATION FINANCIAL INNOVATION FINANCIAL INSTABILITY FINANCIAL INSTRUMENTS FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIATION FINANCIAL REPRESSION FINANCIAL SECTOR FINANCIAL SYSTEM FINANCIAL SYSTEMS FOREIGN BORROWING FOREIGN CURRENCY FOREIGN CURRENCY DEPOSITS FOREIGN EXCHANGE FOREIGN EXCHANGE TRANSACTIONS FOREIGN INVESTORS GLOBALIZATION GOVERNMENT GUARANTEE GOVERNMENT INTERVENTION HIGH INFLATION HIGH PREMIUM HIGH RATES INDUSTRIAL COUNTRIES INFLATION INFLATION TARGETING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURANCE INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERNATIONAL RESERVES LEGAL PROTECTION LEGAL SYSTEM LEGAL TENDER LIQUIDATION LIQUIDITY LOANABLE FUNDS LOCAL CURRENCY LOCAL CURRENCY LOANS LONG TERM MACROECONOMIC POLICY MACROECONOMIC STABILITY MARKET RISK MATURITIES MONETARY AUTHORITIES MONETARY POLICIES MONETARY POLICY MONETARY REGIME MORAL HAZARD MUTUAL FUNDS NATIONAL AUTHORITIES NONPERFORMING LOANS OUTPUT PENSIONS POLICY AGENDA POLICY CREDIBILITY POLICY RESEARCH PORTFOLIOS PRIVATE AGENTS PRIVATE SECTOR PROBABILITY OF DEFAULT PUBLIC DEBT PUBLIC SECTOR PURCHASING POWER PURCHASING POWER PARITY REAL EXCHANGE REAL EXCHANGE RATE REAL INTEREST REAL INTEREST RATES REAL SECTOR RESERVE REQUIREMENTS RISK FACTORS RISK PREMIA SECURITIES SOLVENCY STABILIZATION STABLE EXCHANGE RATE STORE OF VALUE TAX SYSTEM TIME DEPOSITS TRANSACTION COSTS TRANSITION ECONOMIES VOLATILITY WAGES BANKING SYSTEMS DOLLARS MACROECONOMIC POLICY INFLATION MONETARY SYSTEMS FINANCIAL DEVELOPMENT FINANCIAL SYSTEMS FOREIGN CURRENCY FINANCIAL INTERMEDIATION CURRENCY MARKETS CURRENCY HOLDINGS OF FUND BANKING SYSTEMS WAGES De Nicol� Honohan, and Ize assess the benefits and risks associated with dollarization of the banking system. The authors provide novel empirical evidence on the determinants of dollarization, its role in promoting financial development, and on whether dollarization is associated with financial instability. They find that: The credibility of macroeconomic policy and the quality of institutions are both key determinants of cross-country variations in dollarization. Dollarization is likely to promote financial deepening only in a high inflation environment. Financial instability is likely higher in dollarized economies. The authors discuss the implications of these findings for financial sector and monetary policies. 2014-05-01T20:19:34Z 2014-05-01T20:19:34Z 2003-08 http://documents.worldbank.org/curated/en/2003/08/2495955/dollarization-banking-system-good-or-bad http://hdl.handle.net/10986/18133 English en_US Policy Research Working Paper;No. 3116 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	ACCOUNTING ACCOUNTING STANDARDS ACTUAL COST ASSET SUBSTITUTION BALANCE SHEETS BANK DEPOSITS BANK FAILURE BANK RESERVES BANKING CRISES BANKING SYSTEM CAPITAL CONTROLS CENTRAL BANK CENTRAL BANKS CORRESPONDENT ACCOUNTS COUNTRY VARIATIONS CURRENCY BOARD CURRENCY BOARDS CURRENCY FLUCTUATION CURRENCY REGIME CURRENCY RISK CURRENCY SUBSTITUTION CURRENCY TRANSACTIONS DEBT DEMAND DEPOSITS DEPOSIT DOLLARIZATION DEPOSIT INSURANCE DEVALUATION DEVELOPING COUNTRIES DOLLAR DEPOSITS DOLLAR INDEXATION DOMESTIC CURRENCY DOMESTIC FINANCIAL SYSTEM DOMESTIC INVESTORS DOMESTIC RESIDENTS ECONOMETRIC EVIDENCE EMPIRICAL EVIDENCE EURO EXCHANGE ARRANGEMENTS EXCHANGE DEPOSITS EXCHANGE RATE EXCHANGE RATE CHANGES EXCHANGE RATE FLEXIBILITY EXCHANGE RATE PEGS EXCHANGE RATE POLICY EXCHANGE RATE REGIME EXCHANGE RATE STABILITY EXCHANGE RATES EXCHANGE RESTRICTIONS EXPROPRIATION EXTERNAL SHOCKS EXTERNALITIES FINANCIAL ASSETS FINANCIAL CONTRACTS FINANCIAL DEEPENING FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL DOLLARIZATION FINANCIAL INNOVATION FINANCIAL INSTABILITY FINANCIAL INSTRUMENTS FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIATION FINANCIAL REPRESSION FINANCIAL SECTOR FINANCIAL SYSTEM FINANCIAL SYSTEMS FOREIGN BORROWING FOREIGN CURRENCY FOREIGN CURRENCY DEPOSITS FOREIGN EXCHANGE FOREIGN EXCHANGE TRANSACTIONS FOREIGN INVESTORS GLOBALIZATION GOVERNMENT GUARANTEE GOVERNMENT INTERVENTION HIGH INFLATION HIGH PREMIUM HIGH RATES INDUSTRIAL COUNTRIES INFLATION INFLATION TARGETING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURANCE INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERNATIONAL RESERVES LEGAL PROTECTION LEGAL SYSTEM LEGAL TENDER LIQUIDATION LIQUIDITY LOANABLE FUNDS LOCAL CURRENCY LOCAL CURRENCY LOANS LONG TERM MACROECONOMIC POLICY MACROECONOMIC STABILITY MARKET RISK MATURITIES MONETARY AUTHORITIES MONETARY POLICIES MONETARY POLICY MONETARY REGIME MORAL HAZARD MUTUAL FUNDS NATIONAL AUTHORITIES NONPERFORMING LOANS OUTPUT PENSIONS POLICY AGENDA POLICY CREDIBILITY POLICY RESEARCH PORTFOLIOS PRIVATE AGENTS PRIVATE SECTOR PROBABILITY OF DEFAULT PUBLIC DEBT PUBLIC SECTOR PURCHASING POWER PURCHASING POWER PARITY REAL EXCHANGE REAL EXCHANGE RATE REAL INTEREST REAL INTEREST RATES REAL SECTOR RESERVE REQUIREMENTS RISK FACTORS RISK PREMIA SECURITIES SOLVENCY STABILIZATION STABLE EXCHANGE RATE STORE OF VALUE TAX SYSTEM TIME DEPOSITS TRANSACTION COSTS TRANSITION ECONOMIES VOLATILITY WAGES BANKING SYSTEMS DOLLARS MACROECONOMIC POLICY INFLATION MONETARY SYSTEMS FINANCIAL DEVELOPMENT FINANCIAL SYSTEMS FOREIGN CURRENCY FINANCIAL INTERMEDIATION CURRENCY MARKETS CURRENCY HOLDINGS OF FUND BANKING SYSTEMS WAGES
spellingShingle	ACCOUNTING ACCOUNTING STANDARDS ACTUAL COST ASSET SUBSTITUTION BALANCE SHEETS BANK DEPOSITS BANK FAILURE BANK RESERVES BANKING CRISES BANKING SYSTEM CAPITAL CONTROLS CENTRAL BANK CENTRAL BANKS CORRESPONDENT ACCOUNTS COUNTRY VARIATIONS CURRENCY BOARD CURRENCY BOARDS CURRENCY FLUCTUATION CURRENCY REGIME CURRENCY RISK CURRENCY SUBSTITUTION CURRENCY TRANSACTIONS DEBT DEMAND DEPOSITS DEPOSIT DOLLARIZATION DEPOSIT INSURANCE DEVALUATION DEVELOPING COUNTRIES DOLLAR DEPOSITS DOLLAR INDEXATION DOMESTIC CURRENCY DOMESTIC FINANCIAL SYSTEM DOMESTIC INVESTORS DOMESTIC RESIDENTS ECONOMETRIC EVIDENCE EMPIRICAL EVIDENCE EURO EXCHANGE ARRANGEMENTS EXCHANGE DEPOSITS EXCHANGE RATE EXCHANGE RATE CHANGES EXCHANGE RATE FLEXIBILITY EXCHANGE RATE PEGS EXCHANGE RATE POLICY EXCHANGE RATE REGIME EXCHANGE RATE STABILITY EXCHANGE RATES EXCHANGE RESTRICTIONS EXPROPRIATION EXTERNAL SHOCKS EXTERNALITIES FINANCIAL ASSETS FINANCIAL CONTRACTS FINANCIAL DEEPENING FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL DOLLARIZATION FINANCIAL INNOVATION FINANCIAL INSTABILITY FINANCIAL INSTRUMENTS FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIATION FINANCIAL REPRESSION FINANCIAL SECTOR FINANCIAL SYSTEM FINANCIAL SYSTEMS FOREIGN BORROWING FOREIGN CURRENCY FOREIGN CURRENCY DEPOSITS FOREIGN EXCHANGE FOREIGN EXCHANGE TRANSACTIONS FOREIGN INVESTORS GLOBALIZATION GOVERNMENT GUARANTEE GOVERNMENT INTERVENTION HIGH INFLATION HIGH PREMIUM HIGH RATES INDUSTRIAL COUNTRIES INFLATION INFLATION TARGETING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL STRUCTURE INSURANCE INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERNATIONAL RESERVES LEGAL PROTECTION LEGAL SYSTEM LEGAL TENDER LIQUIDATION LIQUIDITY LOANABLE FUNDS LOCAL CURRENCY LOCAL CURRENCY LOANS LONG TERM MACROECONOMIC POLICY MACROECONOMIC STABILITY MARKET RISK MATURITIES MONETARY AUTHORITIES MONETARY POLICIES MONETARY POLICY MONETARY REGIME MORAL HAZARD MUTUAL FUNDS NATIONAL AUTHORITIES NONPERFORMING LOANS OUTPUT PENSIONS POLICY AGENDA POLICY CREDIBILITY POLICY RESEARCH PORTFOLIOS PRIVATE AGENTS PRIVATE SECTOR PROBABILITY OF DEFAULT PUBLIC DEBT PUBLIC SECTOR PURCHASING POWER PURCHASING POWER PARITY REAL EXCHANGE REAL EXCHANGE RATE REAL INTEREST REAL INTEREST RATES REAL SECTOR RESERVE REQUIREMENTS RISK FACTORS RISK PREMIA SECURITIES SOLVENCY STABILIZATION STABLE EXCHANGE RATE STORE OF VALUE TAX SYSTEM TIME DEPOSITS TRANSACTION COSTS TRANSITION ECONOMIES VOLATILITY WAGES BANKING SYSTEMS DOLLARS MACROECONOMIC POLICY INFLATION MONETARY SYSTEMS FINANCIAL DEVELOPMENT FINANCIAL SYSTEMS FOREIGN CURRENCY FINANCIAL INTERMEDIATION CURRENCY MARKETS CURRENCY HOLDINGS OF FUND BANKING SYSTEMS WAGES De Nicolo, Gianni Honohan, Patrick Ize, Alain Dollarization of the Banking System : Good or Bad?
relation	Policy Research Working Paper;No. 3116
description	De Nicol� Honohan, and Ize assess the benefits and risks associated with dollarization of the banking system. The authors provide novel empirical evidence on the determinants of dollarization, its role in promoting financial development, and on whether dollarization is associated with financial instability. They find that: The credibility of macroeconomic policy and the quality of institutions are both key determinants of cross-country variations in dollarization. Dollarization is likely to promote financial deepening only in a high inflation environment. Financial instability is likely higher in dollarized economies. The authors discuss the implications of these findings for financial sector and monetary policies.
format	Publications & Research :: Policy Research Working Paper
author	De Nicolo, Gianni Honohan, Patrick Ize, Alain
author_facet	De Nicolo, Gianni Honohan, Patrick Ize, Alain
author_sort	De Nicolo, Gianni
title	Dollarization of the Banking System : Good or Bad?
title_short	Dollarization of the Banking System : Good or Bad?
title_full	Dollarization of the Banking System : Good or Bad?
title_fullStr	Dollarization of the Banking System : Good or Bad?
title_full_unstemmed	Dollarization of the Banking System : Good or Bad?
title_sort	dollarization of the banking system : good or bad?
publisher	World Bank, Washington, DC
publishDate	2014
url	http://documents.worldbank.org/curated/en/2003/08/2495955/dollarization-banking-system-good-or-bad http://hdl.handle.net/10986/18133
_version_	1764438944919846912

Dollarization of the Banking System : Good or Bad?

Similar Items