01738cas a2200241 a 4500 AALejournalIMF006326 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451963502 1018-5941 BD-DhAAL BD-DhAAL Valencia, Fabian. Precautionary Reserves : An Application to Bolivia / Fabian Valencia. Washington, D.C. : International Monetary Fund, 2010. 1 online resource (25 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 Using precautionary savings models we compute levels of optimal reserves for Bolivia. Because of Bolivia's reliance on commodity exports and little integration with capital markets, we focus on current account shocks as the key balance of payments risk. These models generate an optimal level of net foreign assets ranging from 29 to 37 percent of GDP. For comparison purposes, we contrasted these results with standard rule of thumb measures of reserve adequacy, which in the case of Bolivia resulted in substantially lower levels of adequate reserves. These differing results emphasize the need to appropriately account for country-specific risks in order to derive adequate measures of reserve buffers. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2010/054 Full text available on IMF http://elibrary.imf.org/view/journals/001/2010/054/001.2010.issue-054-en.xml IMF e-Library