The Dollarization Debate

by Salvatore, Dominick; Dean, James W.; Willett, Thomas

• ISBN13: 9780195155365
• ISBN10: 019515536X
• Format: Paperback
• Copyright: 2003-03-27
• Publisher: Oxford University Press

Summary

This book takes a global approach, with an emphasis on North and Latin America respectfully, by discussing one of today's most controversial topics in business; Dollarization. With the collapse of the former Soviet Union, and the formation of the Euro in Europe, many countries and debatingwhether or not a common currency is in their best interest. This intriguing volume brings together the leading participants in the current dollarization debates. Many advocate the notion of a common currency, while others feel that in doing so will create financial costs for all that take part,with the severity varying from country to country.

Table of Contents

Contributors	ix
Introduction	3	(14)
Dominick Salvatore, James W. Dean, and Thomas D. Willett
Part I General Analysis
A Visionary's View
1 Currency Areas, Exchange Rate Systems, and International Monetary Reform	17	(29)
Robert Mundell
De Facto Dollarization
2 Unofficial Dollarization in Latin America: Currency Substitution, Network Externalities, and Irreversibility	46	(26)
Edgar L. Feige, Michael Faulend, Velimir Sonje, and Vedran Sosic
Pros and Cons
3 The Pros and Cons of Full Dollarization	72	(30)
Andrew Berg and Eduardo R. Borensztein
4 Is It Time for a Common Currency for the Americas?	102	(9)
Vittorio Corbo
5 Dollarization: Myths and Realities	111	(18)
Sebastian Edwards
6 What Problems Can Dollarization Solve?	129	(11)
Barry Eichengreen
7 What Use Is Monetary Sovereignty?	140	(14)
Kurt Schuler
One Regime for All Countries?
8 The OCA Approach to Exchange Rate Regimes: A Perspective on Recent Developments	154	(18)
Thomas D. Willett
9 Dollarization Does Not Make Sense Everywhere	172	(5)
John Williamson
10 The Problem of Dollar Encroachment in Emerging Markets	177	(19)
Ronald I. McKinnon
11 Which Countries in the Americas Should Dollarize?	196	(10)
Dominick Salvatore
12 Pressures for Currency Consolidation in Insurance and Finance: Are the Currencies of Financially Small Countries on the Endangered List?	206	(15)
George M. von Furstenberg
Part II Political Economy
13 Monetary Union: The Political Dimension	221	(17)
Benjamin J. Cohen
14 Latin American Official Dollarization: Political Economy Aspects	238	(28)
Jurgen Schuldt
15 The Political Economy of Dollarization in Mexico	266	(17)
Nancy Neiman Auerback and Aldo Flores-Quiroga
16 Lessons of the Euro for Dollarization: Analytic and Political Economy Perspectives	283	(16)
Harris Dellas and George S. Tavlas
Part III North America
17 North American Currency Integration: A Canadian Perspective	299	(19)
Thomas J. Courchene and Richard G. Harris
18 The Merit of a North American Monetary Union	318	(23)
Herbert G. Grubel
19 Why Canada Needs a Flexible Exchange Rate	341	(24)
John D. Murray
Part IV Latin America
20 Should Latin America's Common-Law Marriage to the U.S. Dollar Be Legalized? Should Canada's?	365	(10)
James W. Dean
21 What Exchange Rate Arrangement Works Best for Latin America?	375	(12)
Liliana Rojas-Suarez
22 A Dollarization/Free-Banking Blueprint for Argentina	387	(14)
Steven H. Hanke
23 Argentina's Currency Board and the Case for Macroeconomic Policy Coordination in Mercosur	401	(24)
José María Fanelli
24 Cuba: "Dollarization" and "Dedollarization"	425	(24)
Archibald R. M. Ritter and Nicholas P. Rowe
Index	449