Therefore, dollarization performs in both of useful and useless in every economy in the world. Based on the analysis and research has provided many reasons that countries are being dollarized properly are further concerning to regional, graphical, political, and structural variables[Tom99]. Additionally, dollarization influences on investment, government expenditure, price level, employment, and also domestic businesses' demanded in the country[Rog10]. Not only these effects, but the emergence of dollarization in the economy also exists in implantations both microeconomic, and macroeconomic in the world economy. Analytically, all of these have been affecting dollarized countries to be further their prospective outcome and reduce the budget deficit as possible as economists should apply to entirely yet developing countries, such as Cambodia, Burma, Nepal, and so on. Therefore, this paper will clearly clarify these issues, and positive effects on the economy in the ways of dollarization performs variable and vital tasks in the world and examines Cambodia's economy as an example to be specified economically. Therefore, this clarification would benefit for everyone in order to be familiar with how dollarization process in the economy, and help individual to make decision properly. .
What is the Dollarization?.
Dollarization is defined as a situation where the citizens of a country officially or unofficially use a foreign country's currency as legal tender for conducting transactions. The main reason for dollarization is because of greater stability in the value of the foreign currency over domestic currency. The downside of dollarization is that the country gives up its right to influence its own monetary policy by adjusting the money supply.[Dic13] The conceptual terms are how the dollarization performs in the economy, and how the situation responds to the economy partly, or worldwide.
