Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5101111 | Journal of International Money and Finance | 2017 | 42 Pages |
Abstract
This paper studies how the level of international reserves affects the maturity structure of external debt. We show in an illustrative theoretical model that reserves lengthen the maturity of external debt via a flattening of the yield curve. Using data of 66 emerging and developing countries and applying different econometric approaches, we find robust evidence that reserves increase the share of long-term in total external debt. Results hold for private and public external debt individually. Taking reserves and their effect on the debt maturity structure together, they reinforce financial stability.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Xingwang Qian, Andreas Steiner,