In this paper we study dollarization as a commitment device that the Central Bank could use to avoid getting involved … differs from the one that a benevolent Central Bank would want to implement. Dollarization then could be used to restore the … dollarization, the introduction of international banks, and the political process, we find that bank internationalization may help …

countries, central bank holdings of dollar reserves are significantly correlated with the dollar-denominated bank borrowing of … model in which the central bank can deal with private-sector mismatch, and the associated risk of a domestic financial … crisis, in two ways: (i) by imposing ex ante financial regulations such as bank capital requirements; or (ii) by building a …

-out guarantee. The reason is that the prospect of a bail-out induces the rotected bank to expand, thereby intensifying competition … in the deposit market and depressing other banks' margins. In contrast, the effects on the protected bank's risk taking …

-out guarantee. The reason is that the prospect of a bail-out induces the protected bank to expand, thereby intensifying competition …