The aim of this paper is to evaluate the economic consequences on the countries that on one hand protect themselves from future financial crises by accumulating international reserves (IR) while on the other hand expose themselves to severe financial crisis due to their excessive internal and/or...

This paper assesses whether domestic costs of reserve accumulation - and in particular monetary costs - constitute an eventual limit to the process in emerging markets. We find that sterilization is the first measure to deal with these costs. Then, we turn to study whether diminishing ability to...

We examine the effects of active international reserve management (IRM) conducted by central banks of emerging market economies (EMEs) on firm investment in the presence of global financial shocks. Using firm level data from 46 EMEs from 2000 to 2018, we document four findings. First, active IRM...