Currency Choice and the Efficacy of Financial Services

Principal Investigator

Melanie Morten
Economics Department, Stanford School of Humanities & Sciences

Co-Investigators

Joe Kaboski
Notre Dame
Research Locations N/A
Award Date December 2015
Award Type Faculty I-Award

Abstract

Households, especially in low income countries, often take loans denominated in foreign currency. This introduces them to substantial foreign exchange rate risk. We plan to study the effect of borrowing money in foreign currencies on the investment and financial decisions of small entrepreneurs in Armenia. To do this, we will run a RCT in conjunction with a bank where we vary the currency choice offered in loans