12. In some emerging market economies, not only are debt obligations to foreigners denominated in dollars, but

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12. In some emerging market economies, not only are debt obligations to foreigners denominated in dollars, but so are many of the economies’ internal debts, that is, debts of one domestic resident to another. In the chapter, we called this phenomenon liability dollarization. How might liability dollarization worsen the financial market disruption caused by a sharp depreciation of the domestic currency against the dollar?

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International Finance Theory And Policy

ISBN: 9781292238739

11th Global Edition

Authors: Paul R. Krugman, Maurice Obstfeld, Marc Melitz

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