Consumption Baskets and Currency Choice in International Borrowing

Most emerging markets do not borrow much internationally in their own currency, although doing that has been argued as an attractive insurance mechanism. This phenomenon, commonly labeled "the original sin", has mostly been interpreted as...

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Bibliographic Details
Main Authors:	Bengui, Julien, Nguyen, Ha
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCELERATOR AGGREGATE CONSUMPTION ASSET POSITION ASSETS BAILOUT BALANCE SHEET BENCHMARK BILL BOND BOND HOLDERS BOND MARKET BOND MARKETS BOND RETURN BONDS BORROWING COUNTRY BUDGET CONSTRAINT BUDGET CONSTRAINTS BUSINESS CYCLE CAPITAL ACCUMULATION CAPITAL FLOWS CASH HOLDINGS CLAIMANTS COMPETITIVE MARKET CONSUMPTION BASKET CONSUMPTION BASKETS CONSUMPTION DECLINE COUNTRY RISK CREDIT MARKETS CURRENCY CURRENCY COMPOSITION CURRENCY EXPOSURES CURRENT ACCOUNT CURRENT ACCOUNT IMBALANCES DEBT DEBT DENOMINATION DEBT MARKET DEPRECIATION DEVALUATIONS DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT POLICY DOLLAR BOND DOLLAR BONDS DOLLAR DEBT DOLLAR PRICE DOMESTIC CREDIT DOMESTIC CURRENCIES DOMESTIC CURRENCY DOMESTIC ECONOMY DOMESTIC MARKET DOMESTIC MONETARY POLICY DOMESTIC WORKERS ECONOMIC CONDITIONS ECONOMIC RESEARCH ELASTICITY ELASTICITY OF SUBSTITUTION EMERGING ECONOMIES EMERGING MARKET EMERGING MARKET ECONOMIES EMERGING MARKETS EMPLOYMENT EQUATIONS EQUILIBRIUM EQUILIBRIUM CONDITIONS EXCESS RETURN EXCHANGE RATE EXCHANGE RATES EXOGENOUS RATE EXPENDITURES EXTERNAL BORROWING EXTERNAL DEBT EXTERNALITIES EXTERNALITY FINANCIAL CRISES FINANCIAL EXCHANGE FINANCIAL FRAGILITY FINANCIAL INSTABILITY FOREIGN CURRENCY FOREIGN DEBT FOREIGN INCOME FOREIGN INVESTOR FOREIGN INVESTORS FOREIGN LENDERS FOREIGN MARKETS GDP HEDGES HOLDING HOLDINGS IMPLICIT CONTRACT IMPLICIT CONTRACTS IMPORTS INCOME SHOCKS INCOMPLETE MARKETS INFLATION INSTRUMENT INSURANCE INSURER INTEREST RATE INTERNATIONAL BANK INTERNATIONAL BORROWING INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL FLOWS INTERNATIONAL CURRENCY INTERNATIONAL DEBT INTERNATIONAL DEBT MARKETS INTERNATIONAL DIVERSIFICATION INTERNATIONAL ECONOMICS INTERNATIONAL FINANCE INTERNATIONAL PRICE LABOR DEMAND LABOR MARKET LABOR SUPPLY LACK OF CREDIBILITY LEVY LOAN LOAN MARKET LOCAL CURRENCIES LOCAL CURRENCY MACROECONOMICS MARKET STRUCTURES MIDDLE INCOME COUNTRIES MONETARY POLICY MONEY HOLDING MONEY HOLDINGS MONEY SUPPLY MORAL HAZARD MUTUAL FUNDS NEGATIVE SHOCK NOMINAL WAGE OPEN ECONOMY POLITICAL ECONOMY PORTFOLIO PORTFOLIO CHOICE PORTFOLIO CHOICES PORTFOLIO HOLDINGS PORTFOLIOS PRIVATE CREDIT PRODUCTION FUNCTION PRODUCTION FUNCTIONS PRODUCTION STRUCTURE PRODUCTIVITY RANDOM VARIABLES REAL EXCHANGE RATE REAL SHOCK REAL SHOCKS REAL WAGES REPAYMENTS RETURN RISK AVERSE RISK PREMIUM RISK SHARING SHARE OF CAPITAL SMALL COUNTRIES SMALL COUNTRY SMALL ECONOMY SOCIAL RISKS SOURCE OF UNCERTAINTY STANDARD DEVIATION STANDARD DEVIATIONS STEADY STATE STEADY STATE LEVEL STICKY PRICES STICKY WAGES SUPPLIERS SUPPLY SHOCK TOTAL OUTPUT TRADABLE GOOD TRADABLE GOODS UTILITY FUNCTION VOLATILITIES VOLATILITY WAGES WEALTH WORLD DEVELOPMENT INDICATORS WORLD INTEREST RATE
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111103142914 http://hdl.handle.net/10986/3636