A Local Currency in a Dollarized Economy
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A Local Currency in a Dollarized Economy
The paper uses a dual-currency search theoretic approach to demonstrate that it is possible to induce the acceptance of a local currency in a dollarized economy. In the model, we assume that a foreign currency is in full circulation and the government policy tool is the convertibility of the local currency to the foreign currency. We show that the economy can achieve equilibria where two monies...
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ژورنال
عنوان ژورنال: Modern Economy
سال: 2012
ISSN: 2152-7245,2152-7261
DOI: 10.4236/me.2012.35086