Proceedings of the 2009 Financial Crises : Causes, Charateristics & Effects
Financial Crises: Causes, Characteristics and Effects Conference
Edith Cowan University
Place of publication
The dramatic growth in sovereign wealth funds (SWFs) has implications which are still emerging for national economies and globally. This paper considers why SWFs have become key international financial institutions for some countries, particularly developing ones. This adds to the literature on second best development strategies (Hausmann and Rodrik 2003), here applying it to SWFs. A macroeconomic approach is taken towards the phenomenon of reserves accumulation and motives for SWFs. These are evaluated in terms of the pattern of balance of payments and inferred trade and exchange policies. The role of SWFs in promoting country growth and international stability is considered in view of the global financial crisis (GFC).
Field of Research
140210 International Economics and International Finance