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<p>[QUOTE=&quot;Volante, post: 1902530, member: 57279&quot;]Let&#039;s see if I can remember anything from my college economics classes...The central banks of developing countries often have a lot of trouble with rampant inflation.&nbsp; One reason (among many) for that is that the young governments don&#039;t have a stable source of revenue and find it tempting to resort to seigniorage.&nbsp; Seigniorage is where the government uses the treasury as a primary revenue source, printing more money than is demanded by the populace.&nbsp; Inflation is a natural result of the excess flow of banknotes into the economy - Zimbabwe is a good example of a country where seigniorage caused massive inflation.&nbsp; </p><p><br /></p><p>Dollarization, adopting the USD as a country&#039;s currency, allows the country to benefit from the U.S.&#039;s monetary stability.&nbsp; It also has some benefits in terms of attracting foreign investment and in promoting trade with any other countries that are also on the dollar.[/QUOTE]</p><p><br /></p>

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