IDEAS home Printed from https://ideas.repec.org/a/prg/jnlaop/v2010y2010i2id297p3-22.html
   My bibliography  Save this article

State-Run Investment Funds: Major Institutional Investors on Global Financial Markets
[Státní investiční fondy - významný institucionální investor globálních finančních trhů]

Author

Listed:
  • Petr Sedláček

Abstract

The article provides a basic description and taxonomy of sovereign wealth funds, rapidly gaining importance in the international monetary and financial systems. SFWs are pools of assets owned and managed directly or indirectly by governments to achieve specific objectives. Tentative estimates of foreign assets held by SWFs are between USD 1.9 trillion and USD 2.9 trillion. These amounts are about 10 times less than the assets under management of mature market institutional investors and modestly higher than those managed by hedge funds. Current IMF projections are that sovereign wealth funds will accumulate international assets under sovereign management up to about USD 12 trillion by 2012, but growth estimates are different. The author's estimate of the SWFs' growth by 2013 is between USD 3.9-5.4 trillion. These funds have raised concerns about financial stability, corporate governance and political interference and protectionism. The following analysis does not prove the negative distortions of these funds on global financial stability and capital flows. In response to these concerns, the IMF with SWFs have made public voluntary Generally Accepted Principles and Practices (GAPP) for SWF, and the OECD has published guidance on recepient country policies towards the SWFs. Recipient countries should strive to avoid protectionism and should uphold fair and transparent investment frameworks.

Suggested Citation

  • Petr Sedláček, 2010. "State-Run Investment Funds: Major Institutional Investors on Global Financial Markets [Státní investiční fondy - významný institucionální investor globálních finančních trhů]," Acta Oeconomica Pragensia, Prague University of Economics and Business, vol. 2010(2), pages 3-22.
    • Handle: RePEc:prg:jnlaop:v:2010:y:2010:i:2:id:297:p:3-22
    DOI: 10.18267/j.aop.297
    as

    Download full text from publisher

    File URL: http://aop.vse.cz/doi/10.18267/j.aop.297.html
    Download Restriction: free of charge
    File URL: http://aop.vse.cz/doi/10.18267/j.aop.297.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.18267/j.aop.297?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lucas, Robert E, Jr, 1990. "Why Doesn't Capital Flow from Rich to Poor Countries?," American Economic Review, American Economic Association, vol. 80(2), pages 92-96, May.
    2. Roland Beck & Michael Fidora, 2008. "The impact of sovereign wealth funds on global financial markets," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 43(6), pages 349-358, November.
    3. Aaditya Mattoo & Arvind Subramanian, 2009. "Currency Undervaluation and Sovereign Wealth Funds: A New Role for the World Trade Organization," The World Economy, Wiley Blackwell, vol. 32(8), pages 1135-1164, August.
    4. Roland Beck & Michael Fidora, 2008. "The impact of sovereign wealth funds on global financial markets," Intereconomics: Review of European Economic Policy, Springer;German National Library of Economics;Centre for European Policy Studies (CEPS), vol. 43(6), pages 349-358, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gabriel Enrique Alberola & José María Serena, 2009. "Sovereign external assets and the resilience of global imbalances," Working Papers 0834, Banco de España.
    2. Enrique Alberola & José María Serena, 2008. "Reserves, Sovereign Wealth Funds and the Resilience of Global Imbalances," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 37(3), pages 315-343, November.
    3. Alhashel, Bader, 2015. "Sovereign Wealth Funds: A literature review," Journal of Economics and Business, Elsevier, vol. 78(C), pages 1-13.
    4. Fritz Breuss & Werner Roeger & Jan in’t Veld, 2009. "Global impact of a shift in foreign reserves to euros," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 36(1), pages 101-122, February.
    5. Basher, Syed Abul, 2010. "Has the non-oil sector decoupled from oil sector? A case study of Gulf Cooperation Council Countries," MPRA Paper 21059, University Library of Munich, Germany.
    6. Mayerlen, Frank & Sola, Pierre & Be Duc, Louis, 2008. "The monetary presentation of the euro area balance of payments," Occasional Paper Series 96, European Central Bank.
    7. Chahir Zaki & Raimundo Soto & Ibrahim El Badawi, 2018. "Sovereign Wealth Funds, Cross-Border Investment Bias and Institutions: The Case of Arab Countries2," Working Papers 1173, Economic Research Forum, revised 25 Mar 2008.
    8. Jost, Thomas, 2009. "Sovereign Wealth Funds: Size, economic effects and policy reactions," Weidener Diskussionspapiere 13, University of Applied Sciences Amberg-Weiden (OTH).
    9. Irina Bunda, 2007. "The Changing Role of the Exchange Rate in a Globalised Economy," Post-Print halshs-00372820, HAL.
    10. Iikka Korhonen & Tuuli Juurikkala, 2009. "Equilibrium exchange rates in oil-exporting countries," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 33(1), pages 71-79, January.
    11. Steffen Kern, 2008. "Control Mechanisms for Sovereign Wealth Funds in Selected Countries," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 6(4), pages 41-48, December.
    12. Carpantier, J.-F. & Vermeulen, W.N., 2018. "Emergence of sovereign wealth funds," Journal of Commodity Markets, Elsevier, vol. 11(C), pages 1-21.
    13. Reiche, Danyel, 2010. "Sovereign wealth funds as a new instrument of climate protection policy? A case study of Norway as a pioneer of ethical guidelines for investment policy," Energy, Elsevier, vol. 35(9), pages 3569-3577.
    14. Bao Ngoc Dinh, 2011. "The impact of Sovereign Wealth Fund investments on the performance of listed companies," Post-Print halshs-00658489, HAL.
    15. Dariusz Urban, 2011. "Macroeconomic Considerations and Motives of Sovereign Wealth Funds Activity," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 5(2), June.
    16. Raymond, H., 2008. "The effect of Sovereign Wealth Funds’ involvement on stock markets," Occasional papers 7, Banque de France.
    17. I. Anthopoulos & C. Pitelis & C. Liakou, 2016. "The Nature, Performance and Economic Impact of Sovereign Wealth Funds," Working papers wpaper135, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    18. Izabela Pruchnicka-Grabias, 2010. "Sovereign Wealth Funds - The Activity And Its Consequences For The Global Economy," Interdisciplinary Management Research, Josip Juraj Strossmayer University of Osijek, Faculty of Economics, Croatia, vol. 6, pages 510-522.
    19. Sturm, Michael & Adolf, Petra & Peschel, Dominik & Stráský, Jan, 2008. "The Gulf Cooperation Council countries: economic structures, recent developments and role in the global economy," Occasional Paper Series 92, European Central Bank.
    20. Joshua Aizenman & Reuven Glick, 2009. "Sovereign Wealth Funds: Stylized Facts about their Determinants and Governance," International Finance, Wiley Blackwell, vol. 12(3), pages 351-386, December.

    More about this item

    Keywords

    Sovereign Wealth Funds; Generally Accepted Principles and Practices (GAAP); OECD Instruments;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G17 - Financial Economics - - General Financial Markets - - - Financial Forecasting and Simulation
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:prg:jnlaop:v:2010:y:2010:i:2:id:297:p:3-22. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Stanislav Vojir (email available below). General contact details of provider: https://edirc.repec.org/data/uevsecz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.