UID:
almafu_9959301379802883
Umfang:
1 online resource (30 p.)
ISBN:
9781484334270
,
1484334272
,
9781484337028
,
1484337026
Serie:
IMF Working Papers
Inhalt:
Financially closed economies insure themselves against current-account shocks using international reserves. We characterize the optimal management of reserves using an open-economy model of precautionary savings and emphasize several results. First, the welfare-based opportunity cost of reserves differs from the measures often used by practitioners. Second, under plausible calibrations the model is consistent with the rule of thumb that reserves should be close to three months of imports. Third, simple linear rules can capture most of the welfare gains from optimal reserve management. Fourth, policymakers should place more emphasis on how to use reserves in response to shocks than on the reserve target itself.
Anmerkung:
Description based upon print version of record.
,
Cover; Contents; 1 Introduction; 2 A model of optimal reserves management; 2.1 Model structure; 2.2 Carry cost and the target level of reserves; 3 Calibration; 4 Quantitative Results; 4.1 Target and average levels of reserves; 4.2 Impulse response functions; 4.3 Linear rules; 5 Conclusion; 6 Appendix: Certainty Equivalence
Weitere Ausg.:
ISBN 9781484325445
Weitere Ausg.:
ISBN 1484325443
Sprache:
Englisch
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