Cash for Transactions or Store-of-Value? A comparative study on Sweden and peer countries

Carl Claussen, Björn Segendorff () and Franz Seitz
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Björn Segendorff: BIS Innovation Hub

No 427, Working Paper Series from Sveriges Riksbank (Central Bank of Sweden)

Abstract: We estimate the demand for transaction and non-transaction cash balances in Canada, Denmark, Iceland, Sweden and Norway over the last decades using the seasonal method. These countries share many features that are relevant for cash demand, but nevertheless show large differences in terms of aggregate cash balances. While Canada, Iceland and Denmark have seen increased aggregate cash balances, Norway and especially Sweden have seen a dramatic decline. We find that transaction balances have decreased somewhat in all of the countries and the differences in aggregated cash balances is due to differences in the development of non-transactional cash balances. We argue that different de facto legal tender status, crisis exposures, foreign demand and cash supply-side policies help explain these findings.

Keywords: cash; banknotes; seasonal method; transactions; hoarding (search for similar items in EconPapers)
JEL-codes: E41 E51 E58 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2023-07-01
New Economics Papers: this item is included in nep-ban, nep-eec, nep-mon and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:rbnkwp:0427

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