Reserve Currency Status as a Safe Asset Determinant. Empirical Evidence from Main Public Issuers in the Period 2005–2017

Bogołębska Joanna (), Feder-Sempach Ewa () and Stawasz-Grabowska Ewa ()
Additional contact information
Bogołębska Joanna: Ph.D., Associate Professor, University of Lodz, Faculty of Economics and Sociology, International Business and Trade Department, Lodz, Poland
Feder-Sempach Ewa: Ph.D., Assistant Professor, University of Lodz, Faculty of Economics and Sociology, International Finance and Investment Department, Lodz, Poland
Stawasz-Grabowska Ewa: Ph.D., Assistant Professor, University of Lodz, Faculty of Economics and Sociology, International Finance and Investment Department, Lodz, Poland

Comparative Economic Research, 2019, vol. 22, issue 3, 65-81

Abstract: Safe assets are recognized as being the cornerstone of contemporary financial systems. Due to financial globalization and massive international capital flows, they transformed into global safe assets, meaning that both demand and supply sides can be created by international investors. The article consists of two main parts. The first one concentrates on the theoretical issues of safe assets: definitions, attributes, categories of investors who search for them, as well as categories of suppliers. The theoretical considerations lead to the conclusions that only debt instruments can be used as safe assets, and due to limited substitutability between private and public issues, only the latter can perform this function properly, especially in times of stress. In the context of global safe asset considerations, it seems reasonable that only countries issuing reserve currencies can become public issuers of safe assets.

Keywords: safe assets; developed economies; government bonds; reserve currencies (search for similar items in EconPapers)
JEL-codes: E51 E58 E63 F33 (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.2478/cer-2019-0023 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:vrs:coecre:v:22:y:2019:i:3:p:65-81:n:4

DOI: 10.2478/cer-2019-0023

Access Statistics for this article

Comparative Economic Research is currently edited by Zofia Wysokińska

More articles in Comparative Economic Research from Sciendo
Bibliographic data for series maintained by Peter Golla ().