Corneli, Flavia; Tarantino, Emanuele - Banca d'Italia - 2011
The accumulation of large amount of sovereign reserves has fuelled an intense debate on the associated costs. In a … allocates the borrowed resources to either liquid reserves or an illiquid and risky production project. We study how the … opportunity cost of hoarding reserves is affected by the financial and technological characteristics of the economy. In line with …