ECON 1 Lecture Notes - Lecture 5: United States Dollar, Capital Flight, Currency Substitution
Document Summary
It is no secret that in most of the world and mainly in. Venezuela, is a rejection of their national currencies. they treasure the dollar, since it is the stable currency and is valued day after day, Rep blica, highlights that "argentina and venezuela continue to lead the list of latin american countries with a double-digit variation in the consumer price index. " It is not easy in countries with high inflation to control the fall of the currency without applying restrictive exchange measures that, for many, turn into abuse by the state towards its citizens. This is where uncertainty arises if a country should move towards dollarization. For a country to adopt the dollar as its official currency is not an easy decision since it has its advantages and disadvantages, let"s analyze what this implies: In the case of countries like nicaragua and.