The Model of a Shared Interest Rate for a Group of Countries to Circulate a Digital Currency: Featuring the BRICS

Mikhail V. Zharikov ()
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Mikhail V. Zharikov: Financial University under the Government of the Russian Federation, Moscow, Russian Federation

Journal of Central Banking Theory and Practice, 2022, vol. 11, issue 2, 187-208

Abstract: The purpose of the research is to offer a comparative analysis of a libertarian and gradual approach to introducing a market interest rate. The topic is time-relevant since the economies of the emerging markets today face difficult challenges posed by economic, financial and health-care crises, impending price stability, future growth and money market equilibrium. A digital currency is a special issue today due to the outbreak of covid-19, which has made many central banks think about contactless means of payment. The author revealed policy tools to circulate a hypothetical digital currency for the BRICS, including a shared interest rate and the quantity of digital money in circulation needed for the penta-lateral use. The theoretical significance is that the research tries to lay the foundation for a model to launch a virtual regional money market for the countries of the BRICS as well as their partners in wider parts of Europe and Asia. In practical terms, the article recommends a number of tools for monetary policy to deal with the coronavirus crisis of 2020.

Keywords: BRICS; digital currency; virtual money market; shared interest rate; liberal and gradualist approaches; credit surplus; digital money revenue. (search for similar items in EconPapers)
JEL-codes: F14 F17 (search for similar items in EconPapers)
Date: 2022
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