TY  - JOUR
AU  - Edwards,Sebastian
AU  - Magendzo,Igal
TI  - A Currency of One's Own? An Empirical Investigation on Dollarization and Independent Currency Unions
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9514
PY  - 2003
Y2  - February 2003
UR  - http://www.nber.org/papers/w9514
L1  - http://www.nber.org/papers/w9514.pdf
N1  - Author contact info:
Sebastian Edwards
UCLA Anderson Graduate School of Business
110 Westwood Plaza, Suite C508
Box 951481
Los Angeles, CA 90095-1481
Tel: 310/206-6797
Fax: 310/206-5825
E-Mail: sebastian.edwards@anderson.ucla.edu

Igal Magendzo
E-Mail: imagendzo@bcentral.cl
AB  - In this paper we analyze whether  common currency' countries that is, dollarized and independent currency union countries have outperformed countries that have a currency of their own. The paper is empirical and estimates jointly the probability of being a common currency country and  outcome' equations for growth, volatility and inflation. We find that both type of common currency countries have lower inflation than countries with a domestic currency. Dollarized countries have lower growth and higher volatility than countries with a domestic currency. Currency unions, on the other hand, have higher growth and higher volatility than countries with a currency of their own.
ER  -