Transaction Technology Innovation and Demand for Overnight Deposits in Italy

Francesco Columba ()

Macroeconomics from EconWPA

Abstract: The rapid diffusion of ATM and POS during the last decade may have changed money demand patterns; therefore, standard econometric analysis of money demand that do not account for these developments may suffer from a potentially serious omitted variable problem. This paper analyzes the effect of transaction technology innovation on overnight (i.e. demand) deposits. Using panel data for Italy we have two results. First, transaction technology innovation has a positive effect on demand deposits. Second, accounting for this innovation in the regressions significantly reduces the income elasticity of money demand typically detected in the existing empirical estimates.

Keywords: Money demand; payment economics; transaction technology; ATM; POS. (search for similar items in EconPapers)
JEL-codes: E41 (search for similar items in EconPapers)
Date: 2004-04-14
Note: Type of Document - pdf; pages: 34
View list of references View citations in EconPapers

Downloads: (external link)
http://129.3.20.41/eps/mac/papers/0404/0404011.pdf (application/pdf)

Related works:
Working Paper: Transaction Technology Innovation and Demand for Overnight Deposits in Italy (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpma:0404011

Access Statistics for this paper

More papers in Macroeconomics from EconWPA
Series data maintained by EconWPA ().