Quantifying the benefits of a liquidity-saving mechanism
Enghin Atalay,
Antoine Martin and
James McAndrews
No 447, Staff Reports from Federal Reserve Bank of New York
Abstract:
This paper attempts to quantify the benefits associated with operating a liquidity-saving mechanism (LSM) in Fedwire, the large-value payment system of the Federal Reserve. Calibrating the model of Martin and McAndrews (2008), we find that potential gains are large compared to the likely cost of implementing an LSM, on the order of hundreds of thousands of dollars per day.
Keywords: Payment systems; Fedwire; Liquidity (Economics); Federal Reserve System (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fednsr:447
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