| Sumario: | The objective of this paper is to estimate separate demand functions for international reserves by developed and less-developed countries (LDC's). It is shown that the behavioural parameters of the two groups are significantly different. As a by-product, it is also shown that the association between reserve holdings and the relative size of the foreign trade sector is positive. Section I presents some empirical evidence on the demand for reserves, Section II presents separate estimates of the demand for reserves by developed countries and LDC's, and Section III contains some concluding remarks.
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