Analysis of the denomination structure of the Polish currency in the context of the launch of the new 500 zloty banknote

Arkadiusz Manikowski ()
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Arkadiusz Manikowski: Warsaw University, Faculty of Management; Narodowy Bank Polski, Cash and Issue Department

Bank i Kredyt, 2017, vol. 48, issue 5, 495-530

Abstract: Even though cashless payment instruments are proliferating and there is talk of the expected demise of cash, the latter is still widely used, and not only in Poland. The sharp rise in cash in circulation, especially over the last few years, makes it interesting to take a closer look at its most important characteristic – the denomination structure. In this study we analyse this structure with the use of the D-Metric model in the context of NBP’s recent decision to introduce the new 500 zloty banknote. A comparative analysis is also performed of the structure of the domestic currency with the structures observed in other countries. We show that the denomination structure of the Polish currency has been almost suitable to the prevailing economic conditions since 2015. The exception is 1 and 2 grosz coins, which – according to our results – should be demonetized. The decision about the introduction of the new higher denomination note seems to be an element of adjusting the denomination structure to the conditions in Poland.

Keywords: denomination structure; D-Metric model; principle least effort; principle least cost; 500 zloty note (search for similar items in EconPapers)
JEL-codes: C22 C32 E41 E42 E51 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:nbp:nbpbik:v:48:y:2017:i:5:p:495-530

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