China's Growth, Stability, and Use of International Reserves

Joshua Aizenman, Yothin Jinjarak, Nancy P. Marion

NBER Working Paper No. 19739
Issued in December 2013
NBER Program(s):   IFM

Since the onset of the global financial crisis, China and the U.S. have reduced their current-account imbalances as a share of GDP to less than half their pre-crisis levels. For China, the reduction in its current-account surplus post-crisis suggests a structural change. Panel regressions for a sample of almost 100 countries over 1983-2013 confirm that the relationship between current-account balances and economic variables changed in important ways after the financial crisis. China's rebalancing has been accompanied by a decline in its reserves-to-GDP ratio and greater outward FDI that, in turn, has mitigated reserve hoarding.

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This paper was revised on January 22, 2014

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w19739

Published: Joshua Aizenman & Yothin Jinjarak & Nancy Marion, 2014. "China’s Growth, Stability, and Use of International Reserves," Open Economies Review, Springer, vol. 25(3), pages 407-428, July. citation courtesy of

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