Today I was reading about climbing inflation in the United States, so it got me wondering how would that affect (if at all) an small economy with the U.S dollar as its official currency.
As a bit of background, my country changed its currency for the U.S dollar around 20 years ago amidst an inflationary crisis that caused massive migration and other big problems.
So far, the main argument to keep our economy dollarized, -instead of having our own currency and the ability to depreciate it to be more competitives, etc.- has been that this provides a kind of cap to our inflation rate, which has made the policy quite popular given our recent past.
However, as a complete layman in Economics, I was wondering if a large inflation of the U.S dollar would have an impact over a small (dependent on commodity exports, quite informal, etc.) dollarized economy regardless of its government policies, or it would not be influenced at all. If the impact was inevitable, would there be some policy this country could take to reduce the damage?
Edit: The main effect I was thinking about is inflation itself, meaning a hyperinflation (taking it to the extreme) in the U.S. dollar because of policies in the U.S. would inevitably translate itself as a hyperinflation in the rest of the small dollarized countries or would it be a way of detachment. My country is Ecuador by the way.