
Economies, Год журнала: 2024, Номер 12(10), С. 257 - 257
Опубликована: Сен. 24, 2024
We use a theoretical model to set up the conditions for country attain monetary stability by allowing two freely tradable currencies circulate in parallel. For this parallel system function properly, confidence good behavior of authorities charge is key. Our shows how floating exchange rate between can keep issuers local currency check. The results from our show under which disciplines and thus maintains their purchasing power. In non-volatile economies, it also discourages governments (or private issuers) inflating one as means raise seigniorage, policy displacement market. When foreign payments shortfall—such Greece Cyprus during ‘euro crisis’ mid-2010s, or intractable hyperinflation—leave without medium exchange, choice restore circulation offer path achieving maintaining stability.
Язык: Английский