| Author | Socheat Sou |
| Note | A project submitted in partial fulfillment of the requirements for the degree of Professional Master in Banking and Finance, School of Management |
| Publisher | Asian Institute of Technology |
| Abstract | Dollarization has become the main concern for Cambodia since the stability of inflation and exchange rate, the dollarization still increase. The most frequent discussion was that exchange rate stabilization may maintain the persistence of dollarization. The study found that Nominal exchange rate cause dollarization and not vice versa. The devaluation of nominal exchange rate increases dollarization. Furthermore, there is long-run association between dollarization and nominal exchange rate. Dollarization is caused by previous information of nominal exchange rate. Nominal exchange rate stabilization cause hysteresis of dollarization because during this period exchange rate appreciate but become stable because intervention from NBC. It means that KHR depreciate after intervention. The findings agree with what was found by Ize and Yeyati (1998, 2005) that dollarization hysteresis may result from the effort to stabilize price level and value of local currency at the same time through exchange rate intervention. However, for the reason of export competitiveness, NBC should continue stabilize its exchange rate and focus on other measures other than exchange rate policy to promote KHR. |
| Year | 2016 |
| Type | Project |
| School | School of Management (SOM) |
| Department | Other Field of Studies (No Department) |
| Academic Program/FoS | Master of Business Administration (MBA) (Publication code=SM) |
| Chairperson(s) | Roy, Shyamal ;Venkatesh, Sundar |
| Examination Committee(s) | Wijewardena, Weerakoon A. ;Zimmermann, Willi |
| Scholarship Donor(s) | AIT Fellowship |