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Licensed Unlicensed Requires Authentication Published by De Gruyter December 27, 2010

An SDR Based Reserve System

  • Peter Kenen

This paper proposes the creation of a substitution account within the IMF into which official holders of dollar reserves could deposit a portion of those reserves in exchange for Special Drawing Rights (SDRs), the Fund's own quasi currency. It argues that this innovation would greatly improve the functioning and stability of the international monetary system by precluding reserve-currency diversification by official holders of dollar reserves.

Published Online: 2010-12-27

©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston

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