International reserves and monetary policy

Avner Bar-Ilan, Dan Lederman

Research output: Contribution to journalArticlepeer-review


We present a model that determines both monetary policy and level of international reserves. Strict monetary policy would build precautionary reserves that allow future monetary policy to better stabilize inflation and output and lower the likelihood of forthcoming financial crisis.

Original languageEnglish
Pages (from-to)170-178
Number of pages9
JournalEconomics Letters
Issue number2
StatePublished - Nov 2007


  • Drift control
  • International reserves

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics


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