Predicting the demand for central bank digital currency: A structural analysis with survey data

Jiaqi Li

Journal of Monetary Economics, 2023, vol. 134, issue C, 73-85

Abstract: What would be the potential demand for central bank digital currency (CBDC)? Which design attributes would affect the demand for CBDC? By applying a structural model to a unique Canadian survey dataset, I find that the aggregate CBDC holdings as a percentage of the total household liquid assets could range from 4–52%, based on households’ demand perspective. Allowing banks to respond to CBDC would substantially constrain the take-up of CBDC, reducing the upper bound prediction to below 20%. Important design attributes of CBDC identified are budgeting usefulness, anonymity, bundling of bank services, and rate of return.

Keywords: Central bank digital currency; Demand estimation; Design attributes (search for similar items in EconPapers)
JEL-codes: E50 E58 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (18)

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Working Paper: Predicting the Demand for Central Bank Digital Currency: A Structural Analysis with Survey Data (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:moneco:v:134:y:2023:i:c:p:73-85

DOI: 10.1016/j.jmoneco.2022.11.007

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