01825cas a2200265 a 4500 AALejournalIMF001622 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451874808 1018-5941 BD-DhAAL BD-DhAAL Mourmouras, Alex. Convertibility Risk : The Precautionary Demand for Foreign Currency in a Crisis / Alex Mourmouras, Stabley Black, Charalambos Christofides. Washington, D.C. : International Monetary Fund, 2001. 1 online resource (29 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper presents theoretical work linking money demand to the perceptions of households about the risk that domestic currency may become inconvertible or that it may be devalued. An empirical investigation of the size of this effect is carried out using both cross section data and then monthly data for Korea to estimate an augmented demand for money equation. It is found that the fear of inconvertibility arising from the 1997 Korean currency crisis may have caused broad money demand to fall by 4-5 percentage points, equivalent to the loss of reserves of USD 6-72 billion (or about 30 percent of reserves as measured at end-November 1997). Mode of access: Internet Black, Stabley. Christofides, Charalambos. IMF Working Papers; Working Paper ; No. 2001/210 Full text available on IMF http://elibrary.imf.org/view/journals/001/2001/210/001.2001.issue-210-en.xml IMF e-Library