Is the Gresham´s law still valid? Evidence from South American dollarized eonomies

Kód výsledku v IS VaVaI

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Výsledek na webu

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DOI - Digital Object Identifier

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Jazyk výsledku

angličtina

Název v původním jazyce

Is the Gresham´s law still valid? Evidence from South American dollarized eonomies

Popis výsledku v původním jazyce

Gresham's Law postulates a well-known causality in the economy with two circulating currencies "the bad currency drives out the good one", relating to the market with metal coins with different content of precious metal. The "bad currency" is supposed tobe spent, and the "good currency" to be stored. The value of money nowadays, however, is not determined by the content of silver, or other precious metal, but by the exchange rate. This paper studies the impact of nominal exchange rate volatility on banking deposits in two currencies in two parallel currency markets in South America, Chile and Argentina, where the national currency operates along with the US dollar. Using GARCH model we find that increasing volatility of nominal exchange rate affects negatively deposits in national currency and positively deposits in the US dollar, in both countries in the sample. This may be accepted as the "bad currency drives out the good one" application of Gresham's Law to current economic conditi

Název v anglickém jazyce

Is the Gresham´s law still valid? Evidence from South American dollarized eonomies

Popis výsledku anglicky

Gresham's Law postulates a well-known causality in the economy with two circulating currencies "the bad currency drives out the good one", relating to the market with metal coins with different content of precious metal. The "bad currency" is supposed tobe spent, and the "good currency" to be stored. The value of money nowadays, however, is not determined by the content of silver, or other precious metal, but by the exchange rate. This paper studies the impact of nominal exchange rate volatility on banking deposits in two currencies in two parallel currency markets in South America, Chile and Argentina, where the national currency operates along with the US dollar. Using GARCH model we find that increasing volatility of nominal exchange rate affects negatively deposits in national currency and positively deposits in the US dollar, in both countries in the sample. This may be accepted as the "bad currency drives out the good one" application of Gresham's Law to current economic conditi

Druh

D - Stať ve sborníku

CEP obor

AH - Ekonomie

OECD FORD obor

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Projekt

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Návaznosti

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Rok uplatnění

2013

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název statě ve sborníku

Financial Regulation and Supervision in the after - Crisis Period. Proceedings of 13th International Conference on Finance and Banking

ISBN

978-80-7248-892-6

ISSN

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e-ISSN

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Počet stran výsledku

7

Strana od-do

191-197

Název nakladatele

Slezská univerzita v Opavě, Obchodně podnikatelská fakutla v Karviné

Místo vydání

Karviná

Místo konání akce

Ostrava

Datum konání akce

16. 10. 2013

Typ akce podle státní příslušnosti

EUR - Evropská akce

Kód UT WoS článku

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