Reserve accumulation, growth and financial crises

• 成果类型: Article
• 署名作者: Benigno, Gianluca; Fornaro, Luca; Wolf, Martin
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - New York; Center for Economic & Policy Research (CEPR); Pompeu Fabra University; Centre de Recerca en Economia Internacional (CREI); Barcelona School of Economics; University of St Gallen
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2022.103660
• 发表日期: 2022
• 关键词: Foreign reserve accumulation; Gross capital flows; GROWTH; financial crises; Allocation puzzle; Exchange rate undervaluation

摘要

We present a model that reproduces two salient facts characterizing the international mone-tary system: Fast growing emerging countries i) run current account surpluses, ii) accumulate international reserves and receive net private inflows. We study a two-sector, tradable and non-tradable, small open economy. There is a growth externality in the tradable sector and agents have imperfect access to international financial markets. By accumulating foreign re-serves, the government induces a real exchange rate depreciation and a reallocation of produc-tion towards the tradable sector that boosts growth. Financial frictions generate imperfect substitutability between private and public debt flows so that private agents do not perfectly offset the government policy. The possibility of using reserves to provide liquidity during crises amplifies the positive impact of reserve accumulation on growth. The optimal reserve manage-ment entails a fast rate of reserve accumulation, as well as higher growth and larger current account surpluses compared to the economy with no policy intervention. (c) 2022 Published by Elsevier B.V.