Large hoardings of international reserves: are they worth it?

Several Asian economies have accumulated large stocks of international reserves over the last few years. This motivates the question we address in this paper from an empirical point of view. Are these large increases in reserves an efficient crisis-prevention strategy? Or are they second-best to oth...

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Autores principales:	García Silva, Pablo, Soto, Claudio
Formato:	Artículo
Lenguaje:	eng
Publicado:	Banco Central de Chile 2019
Materias:	DISPONIBILIDADES MONETARIAS
Acceso en línea:	https://hdl.handle.net/20.500.12580/3710
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spelling	oai-20.500.12580-37102021-04-24T10:31:21Z Large hoardings of international reserves: are they worth it? García Silva, Pablo Soto, Claudio DISPONIBILIDADES MONETARIAS Several Asian economies have accumulated large stocks of international reserves over the last few years. This motivates the question we address in this paper from an empirical point of view. Are these large increases in reserves an efficient crisis-prevention strategy? Or are they second-best to other options, such as improving governance and developing better institutions in the financial markets? The current literature does not reach a firm consensus. A number of studies argue that reserve accumulation reduces the likelihood of self-fulfilling speculative attacks. Others, however, stress that reserve accumulation is a relatively costly self-insurance strategy. Moreover, reserve accumulation could also be a counterproductive strategy, while crises are likely to be deeper in the presence of weak financial systems. 2019-11-01T00:03:08Z 2019-11-01T00:03:08Z 2006 Artículo 956-7421-23-4 https://hdl.handle.net/20.500.12580/3710 eng Series on Central Banking, Analysis, and Economic Policies, no. 10 Attribution-NonCommercial-NoDerivs 3.0 Chile http://creativecommons.org/licenses/by-nc-nd/3.0/cl/ .pdf Sección o Parte de un Documento p. 171-206 application/pdf Banco Central de Chile
institution	Banco Central
collection	Banco Central
language	eng
topic	DISPONIBILIDADES MONETARIAS
spellingShingle	DISPONIBILIDADES MONETARIAS García Silva, Pablo Soto, Claudio Large hoardings of international reserves: are they worth it?
description	Several Asian economies have accumulated large stocks of international reserves over the last few years. This motivates the question we address in this paper from an empirical point of view. Are these large increases in reserves an efficient crisis-prevention strategy? Or are they second-best to other options, such as improving governance and developing better institutions in the financial markets? The current literature does not reach a firm consensus. A number of studies argue that reserve accumulation reduces the likelihood of self-fulfilling speculative attacks. Others, however, stress that reserve accumulation is a relatively costly self-insurance strategy. Moreover, reserve accumulation could also be a counterproductive strategy, while crises are likely to be deeper in the presence of weak financial systems.
format	Artículo
author	García Silva, Pablo Soto, Claudio
author_facet	García Silva, Pablo Soto, Claudio
author_sort	García Silva, Pablo
title	Large hoardings of international reserves: are they worth it?
title_short	Large hoardings of international reserves: are they worth it?
title_full	Large hoardings of international reserves: are they worth it?
title_fullStr	Large hoardings of international reserves: are they worth it?
title_full_unstemmed	Large hoardings of international reserves: are they worth it?
title_sort	large hoardings of international reserves: are they worth it?
publisher	Banco Central de Chile
publishDate	2019
url	https://hdl.handle.net/20.500.12580/3710
work_keys_str_mv	AT garciasilvapablo largehoardingsofinternationalreservesaretheyworthit AT sotoclaudio largehoardingsofinternationalreservesaretheyworthit
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Large hoardings of international reserves: are they worth it?

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