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The rapid growth of international reserves---a development concentrated in the emerging markets---remains a puzzle. In this paper we suggest that a model based on financial stability and financial openness goes far toward explaining reserve holdings in the modern era of globalized capital...
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financial centers like Switzerland. We focus on the pattern of capital flows involving the Swiss banking industry. We first rely … into Switzerland by foreign banks. We then use more detailed data from Swiss banking statistics which allow us to … Switzerland, yet are foreign-owned. In addition, while the demand for the Swiss franc was driven by both foreign and domestic …
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