Improving Algorithm of Agarwal Model for the Rational Scale of Chinese Foreign Exchange Reserves

Abstract

It is a kind of vogue to plus constantly the model’s items as to meet the possibly in determining the rational scale of foreign exchange reserves. Some demand factors be added to the transformation of the Agarwal model in costbenefit ideas, its calculation results more, but cannot stand up to the reality of the typical countries, also cannot undergo inspection data, the more special inspection of economic operation of the conforms not actual. This paper eliminates contains repeated in the model modified, and intende to redesign algorithm rules of the model according to economic programs. The rational scale is computed with each passing year since 1997 according to the new algorithm, and improved significantly the international comparability.
Key words: Foreign exchange reserves; Reasonable scale; Agarwal model; Algorithm improved