Search Results
Showing results 1 to 3 of approximately 3.
(refine search)
Report
The Monetary and Fiscal History of Bolivia, 1960-2017
After the economic reforms that followed the National Revolution of the 1950s, Bolivia seemed positioned for sustained growth. Indeed, it achieved unprecedented growth from 1960 to 1977. Mistakes in economic policies, especially the rapid accumulation of debt due to persistent deficits and a fixed exchange rate policy during the 1970s, led to a debt crisis that began in 1977. From 1977 to 1986, Bolivia lost almost all the gains in GDP per capita that it had achieved since 1960. In 1986, Bolivia started to grow again, interrupted only by the financial crisis of 1998?2002, which was the result ...
Working Paper
Financial innovation and the speed of adjustment of money demand: evidence from Bolivia, Israel, and Venezuela
Traditional studies of money demand for both developed and less developed countries have shown that there are periods of "missing money," that is, there is consistent overprediction of real balances. This paper uses cointegration techniques to study the effects of financial innovation on the demand for real balances in Bolivia, Israel, and Venezuela. The results show that financial innovation can account for the instability of money demand observed in these countries. In particular, I find that the long run demand for real balances shifted down. In addition, I show that the speed at which ...
Working Paper
Dollarization hysteresis and network externalities: theory and evidence from an informal Bolivian credit market
This paper considers network externalities from currency acceptability as a determinant of observed persistence of dollarization in Latin American countries. A model with efficiencies from establishing a network of currency users is constructed. Model implications are then tested using a unique data set of daily loan records from an informal Bolivian credit market. Empirical results are consistent with dollarization hysteresis being driven by network externalities from currency adoption. The results also imply that credible exchange rate stabilization policy alone is not sufficient to achieve ...