01834cas a2200265 a 4500 AALejournalIMF002497 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451856668 1018-5941 BD-DhAAL BD-DhAAL De Nicolo, Gianni. Dollarization of the Banking System : Good or Bad? / Gianni De Nicolo, Patrick Honohan, Alain Ize. Washington, D.C. : International Monetary Fund, 2003. 1 online resource (43 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 This paper assesses the benefits and risks associated with dollarization of the banking system. We provide novel empirical evidence on the determinants of dollarization, its role in promoting financial development, and on whether dollarization is associated with financial instability. We find that: (a) the credibility of macroeconomic policy and the quality of institutions are both key determinants of cross-country variations in dollarization; (b) dollarization is likely to promote financial deepening only in a high inflation environment; and (c) financial instability is likely higher in dollarized economies. The implications of these findings for financial sector and monetary policies are discussed. Mode of access: Internet Honohan, Patrick. Ize, Alain. IMF Working Papers; Working Paper ; No. 2003/146 Full text available on IMF http://elibrary.imf.org/view/journals/001/2003/146/001.2003.issue-146-en.xml IMF e-Library