
Interest-bearing CBDCs could solve welfare trade-off – IMF paper

A new paper from the International Monetary Fund argues that making a central bank digital currency (CBDC) interest-bearing would avoid the welfare losses that might be created by non-interest bearing CBDCs.
Designing a non-interest-bearing CBDC creates “a challenging welfare tradeoff for the central bank”, note Itai Agur, Anil Ari and Giovanni Dell’Ariccia in their paper. “On the one hand, a cash-like CBDC risks reducing cash demand below the critical mass”, causing major problems for
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe
You are currently unable to print this content. Please contact info@centralbanking.com to find out more.
You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@centralbanking.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@centralbanking.com