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The Rise and Fall of Sovereign Wealth Accumulation : Causes and Consequences

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  • Matthew Higgins
  • Thomas Klitgaard

Abstract

[eng] This paper examines the sources of the rapid build-up in official foreign assets of recent years. Foreign exchange intervention and burgeoning petrodollar receipts - the two main sources of financing for recent official outflows - have very different implications for domestic monetary management and for the risk-return outlook facing sovereign investors. The paper then considers how the crisis has affected the outlook for official cross-border investment, arguing that we are unlikely to see an early return to the heavy official outflows of recent years. . JEL Classification : F21, F30, F31

Suggested Citation

  • Matthew Higgins & Thomas Klitgaard, 2009. "The Rise and Fall of Sovereign Wealth Accumulation : Causes and Consequences," Revue d'Économie Financière, Programme National Persée, vol. 9(1), pages 179-193.
    • Handle: RePEc:prs:recofi:ecofi_1767-4603_2009_hos_9_1_5504
    DOI: 10.3406/ecofi.2009.5504
    Note: DOI:10.3406/ecofi.2009.5504
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    References listed on IDEAS

    as
    1. Matthew Higgins & Thomas Klitgaard & Robert Lerman, 2006. "Recycling petrodollars," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 12(Dec).
    2. Matthew Higgins & Thomas Klitgaard, 2004. "Reserve accumulation: implications for global capital flows and financial markets," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 10(Sep).
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    More about this item

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F30 - International Economics - - International Finance - - - General
    • F31 - International Economics - - International Finance - - - Foreign Exchange

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