Analyzing new data, the authors find
that the general trend toward increased use of
foreign-currency-denominated bank deposits in emerging
markets has continued, despite declines in a few countries.
Their analysis of the new data suggests that a sizable
fraction (about half, on average) of funds switched to
dollar deposit accounts are effectively exported through the
banking system, thereby reducing the supply of credit.
Moreover, increases in deposit dollarization are associated
with increases in offshore deposits, which probably helps to
explain the authors' finding that dollarization is
associated with an increase in banking spreads. The
authors' evidence supports, though only weakly, the
conjecture that dollarization would tend to raise wholesale
interest rates systematically through a peso premium. In
contrast, greater dollarization is clearly associated with a
higher pass-through coefficient from exchange rate change to
consumer prices, potentially increasing nominal risk in the economy.
Bibliographic Details
| Main Authors: |
Honohan, Patrick,
Shi, Anqing |
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| Format: | Policy Research Working Paper
biblioteca
|
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| Language: | English
en_US |
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| Published: |
World Bank, Washington, DC
2001-12
|
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| Subjects: | BANK LENDING,
BANKING SYSTEM,
BANKNOTES,
BANKS,
BORROWING,
CD,
CENTRAL BANK,
COMPETITIVENESS,
CONSUMER PRICE INDEX,
COUNTRY REPORTS,
COUNTRY RISK,
CREDIT RISK,
CURRENCY ASSETS,
CURRENCY BOARD,
CURRENCY RISK,
DEBT,
DEPOSIT ACCOUNTS,
DEPOSIT DOLLARIZATION,
DEPOSIT INTEREST,
DEPOSIT INTEREST RATES,
DEVALUATION,
DEVELOPING COUNTRIES,
DOLLAR DEPOSITS,
DOMESTIC CURRENCY,
DOMESTIC INFLATION,
EMERGING ECONOMIES,
EMERGING MARKETS,
EXCHANGE CONTROL,
EXCHANGE CONTROLS,
EXCHANGE RATE,
EXCHANGE RATE DEPRECIATION,
EXCHANGE RATE RISK,
EXCHANGE RATES,
EXPECTED RETURN,
FINANCIAL GLOBALIZATION,
FINANCIAL MARKETS,
FINANCIAL SECTOR,
FOREIGN ASSETS,
FOREIGN CURRENCY,
FOREIGN CURRENCY DEPOSITS,
FOREIGN EXCHANGE,
GOVERNMENT DEBT,
HIGH INFLATION,
IMPERFECT COMPETITION,
INDUSTRIAL COUNTRIES,
INFLATION,
INFLATION TAX,
INFLATIONARY POLICIES,
INTEREST RATE,
INTEREST RATES,
INTERNATIONAL FINANCIAL STATISTICS,
LEGISLATION,
LOAN MARKETS,
LOCAL BANKS,
LOCAL BORROWERS,
LOCAL CURRENCY,
M2,
MACRO POLICY,
MACROECONOMIC POLICY,
MONEY MARKET,
MONEY SUPPLY,
NET FOREIGN ASSETS,
NOMINAL DEPRECIATION,
NOMINAL DEVALUATION,
NOMINAL EXCHANGE RATE,
POLICY CREDIBILITY,
POLICY RESEARCH,
PORTFOLIO,
PRIVATE SECTOR,
PROFITABILITY,
RATE OF EXCHANGE,
REAL EXCHANGE,
REAL EXCHANGE RATE,
REAL EXCHANGE RATES,
REAL INTEREST,
REAL INTEREST RATE,
REAL INTEREST RATES,
REGRESSION ANALYSIS,
RISK PREMIUM,
STANDARD DEVIATION,
WAGES,
WHOLESALE PRICES, |
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| Online Access: | http://documents.worldbank.org/curated/en/2001/12/1671256/deposit-dollarization-financial-sector-emerging-economies
http://hdl.handle.net/10986/19409
|
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