The Positive Case for a CBDC

Andrew Usher, Edona Reshidi, Francisco Rivadeneyra and Scott Hendry

No 2021-11, Discussion Papers from Bank of Canada

Abstract: In this paper we discuss the competition and innovation arguments for issuing a central bank digital currency (CBDC). A CBDC could be an effective competition policy tool for payments. On innovation, we argue that a CBDC could be necessary to support the vibrancy of the digital economy by helping solve market failures and fostering competition and innovation in new digital payments markets. Overall, competition and innovation are supporting arguments for issuing a CBDC.

Keywords: Digital currencies and fintech; Financial institutions; Financial stability (search for similar items in EconPapers)
JEL-codes: E58 L5 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2021-07
New Economics Papers: this item is included in nep-cba, nep-com, nep-isf, nep-mac, nep-mon, nep-pay and nep-reg
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:bca:bocadp:21-11

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