@article{Balma:332489,
      recid = {332489},
      author = {Balma, Lacina},
      title = {Foreign Currency Debt and Exchange Rate Regimes in the  Prospective Monetary Union of the ECOWAS Countries},
      address = {2014},
      pages = {44},
      year = {2014},
      note = {Presented at the 17th Annual Conference on Global Economic  Analysis, Dakar, Senegal},
      abstract = {Corporates in developing countries often issue foreign  currency denominated debt. Liability dollarization carries  additional risks since large devaluation of the real  exchange rate can suddenly raise default probabilities. We  use a small open economy Dynamic Stochastic General  Equilibrium model with the “balance sheet channel” similar  to Bernanke et al (1999) explicitly modeled to study the  implications of liability dollarization for the conduct of  monetary policy. Bayesian estimation methods are employed  and the model is estimated for the Economic Community of  the West African States (ECOWAS). We find that a floating  regime offers greater stability than a hard peg. Results  are robust to different model parameters, except for the  degree of openness, highlighting the role of  demand-switching effects.},
      url = {http://ageconsearch.umn.edu/record/332489},
}