Overshooting and Dollarization in the Democratic Republic of the Congo

 
Author/Editor: Beaugrand, Philippe
 
Publication Date: May 01, 2003
 
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: The paper develops an interpretation of volatile exchange rate movements in a dollarized economy with very high rates of inflation. Differences between the rate of inflation and currency depreciation (over- or undershooting of the exchange rate) are seen as a proxy for changes in the relative demand for domestic and foreign currency. A simple model is calibrated for the Democratic Republic of the Congo in the 1990s and is used to derive estimates of the rate of dollarization.
 
Series: Working Paper No. 03/105
Subject(s): Dollarization | Congo, Democratic Republic of the | Exchange rates | Economic models

Author's Keyword(s): Overshooting | Dollarization | Congo | Democratic Republic of | Zaire
 
English
Publication Date: May 01, 2003
ISBN/ISSN: 1934-7073 Format: Paper
Stock No: WPIEA1052003 Pages: 26
Price:
US$15.00 (Academic Rate:
US$15.00 )
 
 
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