Benigno, Pierpaolo (2023). Monetary Policy in a World of Cryptocurrencies. Journal of the European Economic Association, 21(4), pp. 1363-1396. Wiley 10.1093/jeea/jvac066
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Can currency competition affect central bank's control of interest rates and prices? Yes, it can. In a two-currency world with competing cash (material or digital), the growth rate of the cryptocurrency sets an upper bound on the nominal interest rate and the attainable inflation rate, if the government currency is to retain its role as medium of exchange. In any case, the government has full control of the inflation rate. With an interest-bearing digital currency, equilibria in which government currency loses medium-of-exchange property are ruled out. This benefit comes at the cost of relinquishing control over the inflation rate.
Item Type: |
Journal Article (Original Article) |
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Division/Institute: |
03 Faculty of Business, Economics and Social Sciences > Department of Economics |
UniBE Contributor: |
Benigno, Pierpaolo |
Subjects: |
300 Social sciences, sociology & anthropology > 330 Economics |
ISSN: |
1542-4774 |
Publisher: |
Wiley |
Language: |
English |
Submitter: |
Julia Alexandra Schlosser |
Date Deposited: |
26 Oct 2022 13:57 |
Last Modified: |
31 Oct 2023 08:47 |
Publisher DOI: |
10.1093/jeea/jvac066 |
BORIS DOI: |
10.48350/174107 |
URI: |
https://boris.unibe.ch/id/eprint/174107 |
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