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Dollarization of the North Korean Economy: Causes and Effects

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  • Lee, Jongkyu
  • Lee, Suk

Abstract

A generalization and the widespread use of foreign currency in North Korea is called dollarization. Opinions are mixed over the backgrounds and the causes of the phenomenon, whether it is peculiar to the North, what it implies about the reality, and what effects it will have on the North's economy. Dollarization was selected as the topic of the second edition of , a new KDI series devoted to answer fundamental questions of the study of the North Korean economy based on expert interviews. This edition begins with the economic concept of dollarization and moves on to its features and influences. We hope you find this article informative and useful.

Suggested Citation

  • Lee, Jongkyu & Lee, Suk, 2020. "Dollarization of the North Korean Economy: Causes and Effects," Dialogue on the North Korea Economy March 2020, Korea Development Institute (KDI).
    • Handle: RePEc:zbw:kdidia:march2020
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    References listed on IDEAS

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    1. Edgar L Feige, 2003. "Dynamics of Currency Substitution, Asset Substitution and De facto Dollarisation and Euroisation in Transition Countries," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 45(3), pages 358-383, September.
    2. Mun , Sung Min & Jung , Seung Ho, 2017. "Dollarization in North Korea: Evidence from a Survey of North Korean Refugees," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 21(1), pages 81-100, March.
    3. Eduardo Levy Yeyati, 2006. "Financial dollarization: evaluating the consequences [‘A simple model of monetary policy and currency crises’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 21(45), pages 62-118.
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    5. Kutan, Ali M. & Ozsoz, Emre & Rengifo, Erick W., 2012. "Cross-sectional determinants of bank performance under deposit dollarization in emerging markets," Emerging Markets Review, Elsevier, vol. 13(4), pages 478-492.
    6. Mr. Pablo F Druck & Mr. Alexander Plekhanov & Mr. Mario Dehesa, 2007. "Relative Price Stability, Creditor Rights, and Financial Deepening," IMF Working Papers 2007/139, International Monetary Fund.
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