Central Bank Digital Currency: Implications for Economic Growth, Inflation, and the Path to SDG Achievement

Vinay Kumar and Ashok Kumar Chauhan
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Vinay Kumar: Kurukshetra University, Department of Economics
Ashok Kumar Chauhan: Kurukshetra University, Department of Economics

Chapter Chapter 1 in Digital Currencies and the Green Economy, 2025, pp 1-18 from Springer

Abstract: Abstract Currency has changed its forms many times since its inception although performing largely same functions. Central Bank Digital Currency (CBDC) is newest form. CBDC is the digital equivalent to paper currency issued by central bank of any country. This chapter reviews the limited literature available that shows the impact of CBDC on economic growth and inflation. There are only three countries that have fully launched the CBDC. So, there is few studies available that uses actual data to find the impact of CBDC on sustainable growth. Studies show that there is positive impact on economic growth and most researchers are agree that there will be increase in economic growth after the launch of CBDC. Inflation can also be controlled when central bank uses CBDC as monetary policy tool. In case of Nigeria there is increase in inflation after the launch of eNeira which is non-interest-bearing. Most researchers believe that interest-bearing CBDC can control inflation more effectively. Positive impact of CBDC on economic growth would also help in achievement of Sustainable Development Goals (SDGs). Higher economic growth helped by CBDC would help in achievement of Targets 8.1 & 8.2 which are measured by indicators “Annual Growth Rate of Real GDP Per Capita” and “Annual Growth Rate of Real GDP Per Employed Person,” respectively.

Keywords: eNeira; Central Bank Digital Currency (CBDC)Central Bank Digital Currency (CBDC); BitcoinBitcoin; Ecuador; macroeconomic stability; SDGs; sustainable growth (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/978-981-95-2282-8_1

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