This paper investigates the drivers of reserves in emerging markets (EMs) and small island (SIs)
and develops an operational metric for estimating reserves in SIs taking into account their unique
characteristics. It uses quantile regression techniques to allow the estimated factors driving
reserves holdings to vary along the reserves' holding distribution and tests for equality among the
slope coefficients of the various quantile regressions and the overall models. F-tests comparing
the inter-quantile differences could not reject the null that the models for the different quantiles of
SIs reserve distribution were similar but this was rejected for EMs distribution suggesting that
models explaining drivers of reserve holdings should take into account the country's reserve
holdings. Empirical analysis suggests that the metric performs better than existing metrics in
reducing crisis probabilities in SIs.
Add to Cart by clicking price of the language and format you'd like to purchase
Available Languages and Formats
Prices in red indicate formats that are not yet available but are forthcoming.