2 ms·
Ability to implement monetary policy comes from monetary sovereignty. Monetary sovereignty is a spectrum, with countries having high degrees of MS and low degr
by 99_00 5y ago
Ability to implement monetary policy comes from monetary sovereignty.
Monetary sovereignty is a spectrum, with countries having high degrees of MS and low degrees of MS. Since El Salvador pegs its currency to the US dollar it has a low degree of monetary sovereignty.
Having a low degree of monetary sovereignty is the reason countries like Greece ran into so much trouble after the 2008 financial crisis. Greece doesn't control its currency. Where as the US does and it did much better.
- el-salvador 5y agoOur currency is the USD. The former local currency only exists in collectors hands or old laws.
- 99_00 5y agoThanks for the correction. Do you know how remittances to El Salvador work in practice? Do people use regulated money transfer services (Western Union) or do they use informal trust based money transfer services? https://en.wikipedia.org/wiki/Informal_value_transfer_system https://en.wikipedia.org/wiki/Informal_value_transfer_system