What determines the emergence of a new sovereign wealth fund?

The aim of the paper is to analyse the determinants of the creation of a new sovereign wealth fund (SWF) for a country. Despite the recent financial crisis, 32 SWFs have been created between 2005 and 2012 and about 70 between 2013 and 2015. After trying to find a consensus on the definition of a SWF and classifying them according to different criteria such as the source of funding, the stated objectives, the governance structure, the type of management and the political regime of the home country, we test if the emergence of these new recent founds can be explained by the following factors: 1) the existence of natural resource rents; 2) the evolution of the oil price; 3) the governance of the country; 4) a way to allow excess foreign exchange reserves held by central banks to be channelled away from  low-yield sovereign bonds into higher-return corporate bonds or equity. We test these hypotheses on a sample of 30 countries that established a SWF over the period 2000-2015 and compare them to a large panel of countries that did not set up a SWF over this period. In order to allow the temporal dimension as well as the unobserved heterogeneity between SWFs, a panel logit model with fixed effects is estimated. We find that the constitution of SWFs has followed the evolution of the oil price and depends on the governance of the country.