@techreport{NBERw7792, title = "Dollarization of Liabilities:
Underinsurance and Domestic Financial Underdevelopment", author
= "Ricardo J. Caballero and Arvind Krishnamurthy", institution =
"National Bureau of Economic Research", type = "Working Paper",
series = "Working Paper Series", number = "7792", year = "2000",
month = "July", doi = {10.3386/w7792}, URL =
"http://www.nber.org/papers/w7792", abstract = {While there is
still much disagreement on the causes underlying recent emerging
markets' crises, one factor that most observers have agreed upon
is that contracting dollar' (foreign currency) denominated
external debt as opposed to domestic currency debt created
balance sheet mismatches that led to bankruptcies and
dislocations that amplified downturns. Much of the analysis of
the currency-balance sheet channel' hinges on the assumption
that companies contract dollar denominated debt. Yet there has
been little systematic inquiry into why companies must or choose
to take on dollar debt. In this paper we c