"Dollar Diplomacy" received its terminology from the policy of additional support by the government for American enterprises abroad. This was particularly apparent in American relations with China.
Scholars claim that American Foreign Policy has always been concerned about American business interests but in the 20th century became more pronounced. When the US added the Roosevelt Corollary to the Monroe Doctrine in if effect involved the US government in the finances of countries in the Western Hemisphere.
During the administration of Howard Taft American commercial interest became even more central to the Foreign policy of the country. Taft and Secretary of State Philander C Knox believed that one of the major roles of American diplomacy was to promote American business. Knox who was a former corporate lawyer for US Steel believed that promoting American commercial interest were foremost.
The US became involved in Liberia and many places in South and Central America on behalf of US corporate interest. These actions became known as “Dollar Diplomacy”.