The Demand for International Reserves and Their Opportunity Cost
An empirical study showing that countries' reserve holdings are sensitive to the rates at which they can borrow on international financial markets, this analysis confirms the view that holding major currencies as reserve assets has costs that are frequently unrecognized. During 1978-82 for 24 sample countries, and during 1978-86 for the same sample less those countries with debt-servicing difficulties, international borrowing costs were found to be a highly significant determinant of reserve holdings--particularly before 1982 for the group that were to have debt difficulties.
Volume (Year): 36 (1989)
Issue (Month): 3 (September)
|Contact details of provider:|| Web page: http://www.palgrave-journals.com/|
|Order Information:|| Postal: Palgrave Macmillan Journals, Subscription Department, Houndmills, Basingstoke, Hampshire RG21 6XS, UK|
Web: http://www.palgrave-journals.com/pal/subscribe/index.html Email:
When requesting a correction, please mention this item's handle: RePEc:pal:imfstp:v:36:y:1989:i:3:p:708-732. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Daniel Foley)
If references are entirely missing, you can add them using this form.