Capital Flows, Financial Integration, and International Reserve Holdings : The Recent Experience of Emerging Markets and Advanced Economies /

This paper examines the interaction between capital flows and international reserve holdings in the context of increasing financial integration. For emerging markets the sensitivity of reserves to net capital flows was negative in the 1980s, but became positive after the Asian crisis when these coun...

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Bibliographic Details
Main Author: Sharma, Sunil
Other Authors: Choi, Woon, Stromqvist, Maria
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2007.
Series:IMF Working Papers; Working Paper ; No. 2007/151
Online Access:Full text available on IMF
Description
Summary:This paper examines the interaction between capital flows and international reserve holdings in the context of increasing financial integration. For emerging markets the sensitivity of reserves to net capital flows was negative in the 1980s, but became positive after the Asian crisis when these countries used net capital flows to build up reserves. For advanced countries, net capital flows had a negative effect on reserves, especially in recent years. Using measures of financial globalization, we also provide evidence that the sensitivity of reserves to net capital flows increased with globalization for emerging markets while it decreased for advanced countries.
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Physical Description:1 online resource (36 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students