Optimal versus adequate level of international reserves: evidence for Turkey

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dc.citation.epage1569en_US
dc.citation.issueNumber13en_US
dc.citation.spage1557en_US
dc.citation.volumeNumber37en_US
dc.contributor.authorOzyildirim, S.en_US
dc.contributor.authorYaman, B.en_US
dc.date.accessioned2016-02-08T10:22:51Z
dc.date.available2016-02-08T10:22:51Z
dc.date.issued2005en_US
dc.departmentDepartment of Managementen_US
dc.description.abstractThe determination of international reserve balance for emerging economies is part of the efforts to strengthen the immunity of these economies to crises. However, there is still evidence on crises even for the countries with large foreign reserves. It has usually been experienced that the countries with greatest need for reserves economize more than others on their holdings since they might underestimate the cost of crisis. In this study, the official international reserves of Turkey are tested against optimality and adequacy. During 1988-2002, the actual reserves fell short of both the optimal and the adequate levels. They are only optimal when the expected cumulative contraction is about 5.2% of real GDP under crisis. However, early evidence from emerging economies and Turkey show that crises hit more heavily. Hence, it is found that the current financial structure in Turkey such as the absence of capital controls and a highly dollarized banking system necessitates more foreign reserves for preventing any future economic and/or financial shocks.en_US
dc.identifier.doi10.1080/00036840500166373en_US
dc.identifier.eissn1466-4283
dc.identifier.issn0003-6846
dc.identifier.urihttp://hdl.handle.net/11693/24018
dc.language.isoEnglishen_US
dc.publisherRoutledgeen_US
dc.relation.isversionofhttp://dx.doi.org/10.1080/00036840500166373en_US
dc.source.titleApplied Economicsen_US
dc.subjectFinancial crisisen_US
dc.subjectFinancial marketen_US
dc.subjectNational economyen_US
dc.subjectTurkeyen_US
dc.subjectWorlden_US
dc.titleOptimal versus adequate level of international reserves: evidence for Turkeyen_US
dc.typeArticleen_US

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