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An Incentive-Compatible Suggestion for Seigniorage Sharing with Dollarizing Countries

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Sixteen countries now give the U.S. dollar legal-tender status. Although dollarizing can help emerging market countries gain monetary credibility and avoid currency crisis, many do not want to give up the seigniorage revenues associated with issuing their own fiat currency. This article offers a proposal for seignoirage sharing.


Suggested citation: Humpage Owen, 2002. "An Incentive-Compatible Suggestion for Seigniorage Sharing with Dollarizing Countries," Federal Reserve Bank of Cleveland, Policy Discussion Paper no. 02-04.

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