Series: IMF Working Papers
Author(s): Alain Ize , and Andrew Powell
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 April 2004
Keywords: currency risk, moral hazard, credit risk, risk aversion, capital requirements,
We develop a theoretical framework that encompasses four distinct motives for dollarization and discuss appropriate policy responses to help contain dollarization and its attendant risks. "Moral hazard" dollarizati...