01685cas a2200241 a 4500 AALejournalIMF002396 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451851939 1018-5941 BD-DhAAL BD-DhAAL Oomes, Nienke. Network Externalities and Dollarization Hysteresis : The Case of Russia / Nienke Oomes. Washington, D.C. : International Monetary Fund, 2003. 1 online resource (36 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Dollarization in Russia increased rapidly during the early 1990s, but failed to come down in the second half of the 1990s in spite of exchange rate stabilization. To explain this "dollarization hysteresis," this paper develops a model in which network externalities in the demand for currency can generate multiple stable steady states for the dollarization ratio. The model is estimated using a new source of data on dollar currency holdings in Russia. On the basis of these estimates, which confirm the existence of network externalities, the paper discusses several policies that could result in a permanent decrease in dollarization. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2003/096 Full text available on IMF http://elibrary.imf.org/view/journals/001/2003/096/001.2003.issue-096-en.xml IMF e-Library