According to Cato Institute experts, full dollarization of the Argentine economy helps to protect “ordinary people’s purchasing power” from corrupt politicians and “often subservient—or simply incompetent—central bankers.” The experts said the loss of seigniorage should be seen as “an infinitesimal price to pay for the advantages of dollarization.”
Fighting Inflation With Dollarization
Argentina should consider dollarizing its economy because this “protects ordinary people’s purchasing power” from corrupt politicians and “often subservient—or simply incompetent—central bankers,” authors of the latest Cato Institute blog post. The authors, Daniel Raisbeck, a policy analyst and the research associate Gabriela Calderon de Burgos, argue that only full dollarization can help Argentina control inflation which currently hovers above 100%.
To support their argument, the two experts point to the inflation rates in South America’s three fully dollarized countrie
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