Table 6.
Alternative Measures: Imports and Invoicing Share, De Jure Peg, Total Level of Reserves
| Imports Share | Invoicing Share | EMDE | ||||
|---|---|---|---|---|---|---|
|
EMDE (1) |
AE (2) |
EMDE (3) |
AE (4) |
Total reserves (5) |
De jure Peg (6) |
|
| Lagged Reserve Share | 0.68*** | 0.79*** | 0.68*** | 0.51*** | 0.68*** | 0.69*** |
| (0.02) | (0.06) | (0.03) | (0.08) | (0.02) | (0.02) | |
| Trade Share | 0.04 | 0.09 | –0.07 | –0.05 | 1.29** | –0.08 |
| (0.07) | (0.09) | (0.08) | (0.32) | (0.58) | (0.10) | |
| FX Alignment | –0.06*** | –0.07*** | –0.06*** | 0.00 | ||
| (0.01) | (0.01) | (0.01) | (0.01) | |||
| Debt Share | 0.10*** | 0.05* | 0.12*** | 0.11*** | ||
| (0.03) | (0.03) | (0.04) | (0.04) | |||
| Bank Claims Share | 0.08*** | 0.08 | ||||
| (0.03) | (0.05) | |||||
| Trade Share*Log Reserves | –0.06** | |||||
| (0.02) | ||||||
| Observations | 1,585 | 417 | 380 | 104 | 1,585 | 1,585 |
| R-squared | 0.52 | 0.69 | 0.57 | 0.53 | 0.53 | 0.52 |
Robust standard errors in parentheses. ***, **, * indicates significance at the 1%, 5%, and 10% levels, respectively. All specifications include time and country-currency fixed effects. Reserve shares for four reserve currencies (US dollar, British pound, Japanese yen, and euro) are obtained from the central banks’ websites. “Trade Share” is the share of imports with the reserve issuer, obtained from the Direction of Trade Statistics., or share in imports invoicing, obtained from Boz et al. (2022). “FX Alignment” is a dummy variable equal to one if the exchange rate co-moves with the reserve currency, as estimated by Ilzetzki et al. (2019). In column (4), “FX Alignment” dummy is replaced with the de jure peg to a reserve currency from the IMF’s Annual Report on Exchange Arrangements and Exchange Restrictions database. “Debt Share” is the share of public debt denominated in a given reserve currency, obtained from the World Bank’s International Debt Statistics dataset. “Bank Claims Share” is the share of cross-border bank claims denominated in a given reserve currency obtained from the Bank for International Settlements international banking data by location. Data on the levels of total reserves come from IMF’s International Financial Statistics database. AE = advanced economies; EMDE = emerging market and developing economies