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on Payment Systems and Financial Technology |
| By: | Greene, Claire (Federal Reserve Bank of Boston); Schuh, Scott (Federal Reserve Bank of Boston); Stavins, Joanna (Federal Reserve Bank of Boston) |
| Abstract: | The 2015 Survey of Consumer Payment Choice (SCPC) was implemented using a new longitudinal panel, the Understanding America Study (UAS), and results are not yet comparable to the 2008–2014 SCPC. In 2015, U.S. consumers made 68.9 payments per month. Debit cards remained the most popular payment instrument among U.S. consumers in 2015, accounting for 32.5 percent of their monthly payments, followed by cash (27.1 percent) and credit or charge cards (21.3 percent). For nonbills, consumers used cash and debit equally—about one-third of the time for each. For bills, consumers used payment cards for half of bill payments and electronic payments from bank accounts for one-quarter of bill payments. In 2015, U.S. consumers on average held $202 in cash (on person and stored on property, large values excluded). Use of new payment technologies was still relatively rare. Just over 1 percent of consumers had a Venmo account in 2015. About half a percent of U.S. consumers held bitcoin or other virtual currencies. |
| Keywords: | cash; checks; checking accounts; debit cards; credit cards; prepaid cards; electronic payments; payment preferences; unbanked; Survey of Consumer Payment Choice |
| JEL: | D12 D14 E42 |
| Date: | 2017–08–08 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbdr:17-3&r=pay |
| By: | Asongu, Simplice; Biekpe, Nicholas |
| Abstract: | This study assesses how market power in the African banking industry is affected by the complementarity between information sharing offices and information and communication technology (ICT). The empirical evidence is based on a panel of 162 banks consisting of 42 countries for the period 2001-2011. Three estimation techniques are employed, namely: (i) instrumental variable Fixed effects to control for the unobserved heterogeneity; (ii) Tobit regressions to control for the limited range in the dependent variable; and (iii) Instrumental Quantile Regressions (QR) to account for initial levels of market power. Whereas results from Fixed effects and Tobit regressions are not significant, with QR: (i) the interaction between internet penetration and public credit registries reduces market power in the 75th quartile and (ii) the interaction between mobile phone penetration and private credit bureaus increases market power in the top quintiles. Fortunately, the positive net effects are associated with negative marginal effects from the interaction between private credit bureaus and mobile phone penetration. This implies that mobile phones could complement private credit bureaus to decrease market power when certain thresholds of mobile phone penetration are attained. These thresholds are computed and discussed. |
| Keywords: | Financial access; Information asymmetry; ICT |
| JEL: | G20 G29 L96 O40 O55 |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:81702&r=pay |
| By: | Simplice Asongu (Yaoundé/Cameroun) |
| Abstract: | The study investigates how education, scientific output and the internet complement mobile phone penetration to affect technology commodity exports in Sub-Saharan Africa for the period 2000-2012. The empirical evidence is based on Generalised Method of Moments. The following main findings are established. First, the internet complements the mobile phone to boost technology goods exports. Second, the internet also complements the mobile phone to boost technology service exports. Third, positive marginal effects are apparent in the roles of educational quality and scientific output on technology goods exports and technology service exports respectively while negative marginal impacts are apparent in the roles of scientific output and educational quality on technology goods exports and technology service exports respectively. Practical and theoretical implications are discussed. |
| Keywords: | Technology exports; Knowledge Economy; Development; Africa |
| JEL: | L59 L98 O10 O30 O55 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:17/042&r=pay |
| By: | Kotiranta, Annu; Seppälä, Timo; Tahvanainen, Antti-Jussi; Hemminki, Markus; Mattila, Juri; Sadeoja, Samuli; Tähtinen, Tea |
| Abstract: | The majority of digital platform research has focused on consumer-centric platforms. Driven by the vast growth potential of direct consumer market access, industrial communities locked behind the conventional gatekeepers in their respective value chains have lately started to tinker with their own platform creation initiatives. Aided by fifteen food industry actors, we identify two critical managerial prerequisites for and design a six-step roadmap towards a participatory infrastructure platform – a platform that allows platform participants to share proprietary data and – by exploiting the data – to create new artifacts in consumer-centric marketplaces. Beyond product innovations, sharing data also enables new optimization layers for operational efficiencies and increased productivity on the industry level. In exploring the participants’ commitment and willingness to shift towards such a platform model, we found three operational data types that the companies would readily be willing to share: 1) transportation data, 2) warehousing data, and 3) demand/supply data managed with decentralized governance models. In the short term, each data type could provide the foundation for the establishment of a specific type of an operational platform: a transportation platform, a warehousing platform, or a market platform. The latter would provide the long-sought direct access to consumer markets. Building on these models, we identify another three strategic avenues for long-term joint development: 1) algorithmic development and evolution of the platform, 2) cross-industry interoperability of the platform, and 3) interoperability with competing platforms. Laying out a roadmap of evolving platform models towards a consumer-driven business ecosystem, we contribute to the empirical literature on industrial platform creation. |
| Keywords: | Platform, e-commerce, multi-sided markets, food industry |
| JEL: | L6 L66 L8 L81 L86 |
| Date: | 2017–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:rif:report:74&r=pay |
| By: | Samphantharak, Krislert (University of California San Diego); Schuh, Scott (Federal Reserve Bank of Boston); Townsend, Robert M. (Massachusetts Institute of Technology) |
| Abstract: | We present a vision for improving household financial surveys by integrating responses from questionnaires more completely with financial statements and combining them with payments data from diaries. Integrated household financial accounts—-balance sheet, income statement, and statement of cash flows—-are used to assess the degree of integration in leading U.S. household surveys, focusing on inconsistencies in measures of the change in cash. Diaries of consumer payment choice can improve dynamic integration. Using payments data, we construct a statement of liquidity flows: a detailed analysis of currency, checking accounts, prepaid cards, credit cards, and other payment instruments, consistent with conventional cash-flows measures and the other financial accounts. |
| Keywords: | surveys; diaries; payments; financial statements; cash flows |
| JEL: | D12 D14 E41 E42 |
| Date: | 2017–05–22 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:17-7&r=pay |
| By: | Francis Annan (Columbia University, School of International and Public Affairs, 420 West 118th Street, New York, NY 10027, USA) |
| Abstract: | Potential fraud can limit the promise of innovative mobile financial markets like Mobile Money, yet little is known about its existence, especially among the poor. In a randomized control trial across 6 low-income communities in Ghana, I evaluate the extent of fraud—overcharged transactions—on Mobile Money and explore the mechanisms underlying the results. Trained auditors visited vendor points, seeking to make actual Mobile Money transactions: either send or receive cash. Approximately 22% of transactions go fraudulent. Additional experiments indicate that fraud is higher for large amount transactions. Consumers who are financially sophisticated are less likely to suffer fraud, but market competition appears to have no effect on this. |
| Keywords: | mobile money; financial fraud; audit study |
| JEL: | O16 G21 G23 D14 G28 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:net:wpaper:1716&r=pay |
| By: | Tröger, Tobias H. |
| Abstract: | Crowdfunding is a buzzword that signifies a sub-set in the new forms of finance facilitated by advances in information technology usually categorized as fintech. Concerns for financial stability, investor and consumer protection, or the prevention of money laundering or funding of terrorism hinge incrementally on including the new techniques to initiate financing relationships adequately in the regulatory framework. This paper analyzes the German regulation of crowdinvesting and finds that it does not fully live up to the regulatory challenges posed by this novel form of digitized matching of supply and demand on capital markets. It should better reflect the key importance of crowdinvesting platforms, which may become critical providers of market infrastructure in the not too distant future. Moreover, platforms can play an important role in investor protection that cannot be performed by traditional disclosure regimes geared towards more seasoned issuers. Against this background, the creation of an exemption from the traditional prospectus regime seems to be a plausible policy choice. However, it needs to be complemented by an adequate regulatory stimulation of platforms' role as gatekeepers. |
| Keywords: | crowdinvesting,crowdfunding,fintech,financial stability,market infrastructure,investor protection |
| JEL: | G23 G28 G38 K22 K23 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:184&r=pay |
| By: | Roy, Martin |
| Abstract: | This paper examines how services trade and policies contribute to connectivity. It highlights the economic relevance of services and identifies some key channels through which trade in services contributes to physical and digital connectivity. The paper examines the impact of services trade policies on connectivity in view of recent research showing their impact on sectoral performance, economic welfare and development. Finally, it discusses the positive contribution that aid for trade can make in support of services policies. The paper finds that services sectors play a multifaceted and significant role in connecting countries to the international trading system, and matter greatly to economic development and the achievement of the Sustainable Development Goals (SDGs). Services significantly affect connectivity by: (i) providing the basic infrastructure to support trade in goods; (ii) facilitating supply chains and entering trade as value added embodied in goods; (iii) providing the backbone that enables e-commerce and the on-line supply of services; (iv) and enhancing export diversification through their cross-border electronic supply. The paper underscores that services trade policies have a fundamental impact on connectivity. Restrictions to investment and cross-border trade in services remain high and widespread. But an enabling policy environment - promoting competition, openness to trade and investment, and adequate regulatory frameworks - can enhance connectivity, lower trade costs, and foster growth and economic performance. For example, improving the policy environment for services sectors can help attract the FDI required to meet the SDGs and develop the ICT infrastructure needed to bridge the digital divide. Aid for Trade can play a supportive role in this regard. |
| Keywords: | WTO,GATS,trade in services,aid for trade,digital trade |
| JEL: | F13 F15 F53 L8 L96 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:ersd201712&r=pay |
| By: | Asongu, Simplice; Nwachukwu, Jacinta |
| Abstract: | This study investigates how the mobile phone can complement knowledge diffusion in order to influence CO2 emissions in 44 Sub-Saharan African countries for the period 2000-2012. The empirical evidence is based on Generalised Method of Moments. Three knowledge diffusion variables representing three of the four pillars of the World Bank’s Knowledge Economy Index are employed: educational quality, information and communication technology (ICT) and scientific output. Six CO2 emission variables are used, namely: CO2 per capita, CO2 from electricity and heat, CO2 from liquid fuel, CO2 from manufacturing and construction, CO2 from transport and CO2 intensity. In the assessments, a decreasing tendency in these variables translates into positive conditions for environmental sustainability. Based on net effect from complementarities, the following findings are established. First, the mobile phone complements education to have a net negative effect on CO2 emissions per capita and CO2 emissions from the consumption of liquid fuel. Second, where some positive net effects of knowledge diffusion are apparent, corresponding marginal effects are negative. Corresponding mobile phone penetration thresholds at which the positive net effects on CO2 emissions can be dampened and reversed are largely within policy range. Practical and theoretical implications are discussed. |
| Keywords: | CO2 emissions; ICT; Economic development; Africa |
| JEL: | C52 O38 O40 O55 P37 |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:81705&r=pay |
| By: | Wenz, Alexander; Jäckle, Annette; Couper, Mick P. |
| Abstract: | We asked members of the Understanding Society Innovation Panel about their willingness to participate in various data collection tasks on their mobile devices. We find that willingness varies considerably depending on the type of activity involved: respondents are less willing to participate in tasks that involve downloading and installing an app, or where data are collected passively. Willingness also varies between smartphones and tablets, and between respondents: respondents who report higher concerns about the security of data collected with mobile technologies and those who use their devices less intensively are less willing to participate in any of the mobile data collection tasks. |
| Date: | 2017–10–04 |
| URL: | http://d.repec.org/n?u=RePEc:ese:ukhlsp:2017-10&r=pay |
| By: | Aaron Rosenbaum; Garth Baughman; Mark D. Manuszak; Kylie Stewart; Fumiko Hayashi; Joanna Stavins |
| Abstract: | The U.S. payments industry is in the process of developing ubiquitous, safe, faster electronic solutions for making a broad variety of business and personal payments. How this market for faster payments will evolve will be shaped by a range of economic forces, such as economies of scale and scope, network effects, switching costs, and product differentiation. Emerging technologies could alter these forces and lead to new organizational arrangements or market structures that are different from those in legacy payment markets to date. In light of this uncertainty, this paper examines three hypothetical market structures that may emerge: a dominant-operator environment, a multi-operator environment, and a decentralized environment. Each of these market structures has different implications for the public policy objectives of efficiency, safety, and ubiquity. The paper also considers tools to promote positive outcomes in each market structure. |
| Keywords: | Faster payments ; Market structure and competition ; Payment system improvement ; Public policy ; Retail payments |
| JEL: | D4 G2 L1 E42 |
| Date: | 2017–09–25 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2017-100&r=pay |
| By: | Asongu, Simplice; Biekpe, Nicholas |
| Abstract: | This study investigates government quality determinants of ICT adoption using Generalised Method of Moments on a panel of 49 Sub-Saharan African (SSA) countries for the period 2000-2012. ICT is measured with mobile phone penetration, internet penetration and telephone penetration rates while all governance dimensions from the World Bank Governance Indicators are considered, namely: political governance (consisting of political stability and “voice & accountability”); economic governance (entailing government effectiveness and regulation quality) and institutional governance (encompassing the rule of law and corruption-control). The following findings are established. First, political stability and the rule of law have positive short run and negative long term effects on mobile phone penetration. Second, the rule of law has a positive (negative) short run (long term) effect on internet penetration. Third, government effectiveness and corruption-control have positive short run and long term effects on telephone penetration. Institutional governance appears to be most significant in determining ICT adoption in SSA. |
| Keywords: | ICT; Governance; Africa |
| JEL: | G20 O38 O40 O55 P37 |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:81704&r=pay |
| By: | Angrisani, Marco (University of Southern California); Foster, Kevin (Federal Reserve Bank of Boston); Hitczenko, Marcin (Federal Reserve Bank of Boston) |
| Abstract: | This document serves as the technical appendix to the 2015 Survey of Consumer Payment Choice administered by the Dornsife Center for Economic and Social Research (CESR). The Survey of Consumer Payment Choice (SCPC) is an annual study designed primarily to collect data on attitudes to and use of various payment instruments by consumers over the age of 18 in the United States. The main report, which introduces the survey and discusses the principal economic results, can be found at http://www.bostonfed.org/economic/cprc/SCPC. In this data report, we detail the technical aspects of the survey design, implementation, and analysis. |
| Keywords: | survey design; sample selection; raking; survey cleaning; poststratification estimates |
| JEL: | D12 D14 E4 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbdr:17-4&r=pay |
| By: | Natalie Chirchietti |
| Abstract: | In recent years, there has been a growing interest in the start-up scene in sub-Saharan Africa. "Silicon Savannah" is today widely used to describe the thriving IT industry in and around Nairobi. Kenya's geographical advantage, its favorable economic reforms, and mature start-up ecosystem makes it stands out positively. Since a lot of hype exists around the start-up scene many investors are drawn to it, but in reality very few start-ups are investment-ready. The increasing start-up requirements and needs force incubators to diversify their offer. In contrast, to traditional incubators, an Innovation Hub (Hub) is characterized based on the concept of open innovation and collaboration. A Hub nurtures an enabling environment where a community of entrepreneurs can grow. At the same time, it serves as a nexus point for the local start-up community, investors, academia, technology companies and the wider private sector. It aims to create a structure where people serendipitously interact with others that they would not typically meet. Considering the great interest for and the large amounts of money invested in Hubs by governments, universities, private companies and other interested parties, not only researchers have been raising the question of the actual benefit of Hubs. This research study aims to investigate to what extent the support offered by the Hubs is tackling the challenges faced by start-ups in Nairobi, Kenya. The analysis can serve as a basis for identifying strength and weaknesses in the Hub models. |
| Keywords: | Entrepreneurship; Innovation Hubs; Start-ups; Kenya |
| JEL: | M13 |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:sau:iznews:1707&r=pay |
| By: | José Tudón (Department of Economics, The University of Chicago, 1126 E. 59th St., Chicago, IL 60637, USA); |
| Keywords: | Net neutrality; Congestion externalities; Internet; Two-sided markets |
| JEL: | D22 D62 L13 L14 L82 L96 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:net:wpaper:1714&r=pay |
| By: | Taro Daiko (OECD); Hélène Dernis (OECD); Mafini Dosso (European Commission - JRC); Petros Gkotsis (European Commission - JRC); Mariagrazia Squicciarini (OECD); Alexander Tuebke (European Commission - JRC); Antonio Vezzani (European Commission - JRC) |
| Abstract: | The speed, scale and scope of the digital transformation and the widespread use of digital technologies in most aspects of our daily lives are changing the way we work, innovate, produce, interact and live. Knowledge flows almost instantaneously and digitalised information can be infinitely replicated, making the exploitation of knowledge a key factor for competitiveness. At the same time, changes at the local level may have global implications and innovation ecosystems become more and more global. These dynamics challenge policy making, and call for understanding the drivers of change, detecting trends in a timely fashion, and acting in a coordinated manner. The internet of things, digital manufacturing and 3D printing, industry 4.0 and big data are all components and drivers of the digital transformation, but the ways in which this new technological revolution will transform industries, countries and societies remain difficult to fully anticipate. As we become increasingly aware of the opportunities and the challenges of the digital economy, we also need to better understand how these technologies are forged and to identify the key players in such changes. The original data and statistics on the innovation output of the world's top corporate R&D investors presented in this report and its focus on digital technologies represent an important step towards this direction. It results from a long-term collaboration between the European Commission's Joint Research Centre and the Organisation for Economic Co-operation and Development, and their joint efforts to provide up-to-date comparable data and state-of-the-art indicators and analysis. This report is directed at a number of stakeholders, including policy makers, industry representatives, practitioners and the scientific community. By exploiting information on patents, trademarks and designs, this work sheds light on the top R&D investors worldwide in the digital economy, their innovative and creative activities and their branding strategies. It is accompanied by a publicly available database that can be used for further analysis in support of evidence-based policy making. |
| Keywords: | Patent, Trademark, Design, Digital, IP bundle, Scoreboard, Top corporate R&D investors, Industrial |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc107015&r=pay |
| By: | Anderson, Robert D.; Kovacic, William E. |
| Abstract: | This paper examines the evolution of national competition (antitrust) policies and enforcement approaches vis-à-vis intellectual property rights (IPRs) and associated anti-competitive practices in major jurisdictions over the past several decades. It focuses especially on the underlying process of economic learning that has, the authors suggest, driven relevant policy changes. Part 2 of the paper outlines the breakthroughs in understanding that have underpinned the evolution of competition policy approaches toward intellectual property licensing arrangements in the US, Canada and the EU. Part 3 elaborates the foundational insights that have motivated competition policy interventions with respect to 'newer' issues such as anti-competitive patent settlements and hold-ups in relation to standard setting processes, in addition to the modern focus on mergers that potentially lessen incentives for innovation and on abuse of dominance/single firm exclusionary practices in IP-intensive network industries. Part 4 outlines some of the core policy concerns and insights driving the increased emphasis that leading competition authorities now devote to policy advocacy and research in relation to the scope and definition of IP rights. Overall, the analysis suggests, firstly, that competition policy applications in the intellectual property sphere are matters of fundamental importance for economic advancement and prosperity, having a direct bearing on innovation, growth and the diffusion of new technologies. Indeed, the roles of IP and competition policy are now sufficiently intertwined and interdependent that neither can be well understood or applied in an optimal fashion in the absence of the other. Secondly, the thought evolution described herein implies that successful policy applications require careful study of market structure and behaviour, not in the abstract but with reference to the particular markets affected. Thirdly, it augurs favourably for the prospects of continuing gradual and incremental convergence in national approaches in this area, even spanning developed and developing countries, on the basis of continual learning and informed self-interest. |
| Keywords: | intellectual property,patents,international trade and competition policy,antitrust,innovation,mergers,anti-competitive settlements,standards,network industries,competition advocacy |
| JEL: | K21 L4 L41 L43 O3 O34 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:ersd201713&r=pay |
| By: | Jäckle, Annette; Burton, Jonathan; Couper, Mick P.; Lessof, Carli |
| Abstract: | We examine non-response in expenditure data collected with a mobile app: 2,432 members of the Understanding Society Innovation Panel in the UK were invited to download an app to record all their spending on goods and services for a month, by scanning receipts or reporting spending in the app. We examine participation at different stages of the process; the prevalence of potential barriers to participation, including access, ability and willingness to use different mobile technologies; and biases in the types of people who participate, considering socio-demographic characteristics, financial position and financial behaviours. |
| Date: | 2017–10–04 |
| URL: | http://d.repec.org/n?u=RePEc:ese:ukhlsp:2017-09&r=pay |
| By: | Adrian Hillenbrand (Max Planck Institute for Research on Collective Goods); Svenja Hippel (Max Planck Institute for Research on Collective Goods) |
| Abstract: | Online platforms provide search tools that help consumers to get betterfitting product offers. But this technology makes consumer search behavior also easily traceable for the platform and allows for real-time price discrimination. Consumers face a trade-off: Search intensely and receive better fits at potentially higher prices or restrict search behavior – be strategically inattentive – and receive a worse fit, but maybe a better deal. We study the strategic buyer-seller interaction in such a situation theoretically as well as experimentally. The search technology we use in the laboratory leads by construction to better-fitting products, but we indeed find that only sellers profit from the buyers’ use of the offered search tools. |
| Keywords: | strategic inattention, price discrimination, information transmission, consumer choice, experiment |
| JEL: | D11 D42 D82 D83 L11 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2017_21&r=pay |
| By: | Jacopo Bonan (FEEM and CMCC); Pietro Battiston (Scuola Superiore Sant’Anna); Jaimie Bleck (University of Notre Dame); Philippe LeMay-Boucher (Heriot Watt University); Stefano Pareglio (Università Cattolica del Sacro Cuore and FEEM); Bassirou Sarr (Paris School of Economics); Massimo Tavoni (Politecnico di Milano and FEEM) |
| Abstract: | We investigate the role of social interaction in technology adoption by conducting a field experiment in neighborhoods of Bamako. We invited women to attend a training/marketing session, where information on a more efficient cooking stove was provided and the chance to purchase the product at market price was offered. We randomly provided an information nudge on a peer’s willingness to buy an improved cookstove. We find that women purchase and use the product more when they receive information on a peer who purchased (or previously owned) the product, particularly if she is viewed as respected. In general, we find positive direct and spillover effects of attending the session. We also investigate whether social interaction plays a role in technology diffusion. We find that women who participated in the session, but did not buy during the intervention, are more likely to adopt the product when more women living around them own it. We investigate the mechanisms and provide evidence supporting imitation effects, rather than social learning or constraint interaction. |
| Keywords: | Technology Adoption, Social Interaction, Cookstoves, Mali |
| JEL: | D03 M31 O13 O33 |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2017.47&r=pay |
| By: | Klühs, Theres; Grohmann, Antonia; Menkhoff, Lukas |
| Abstract: | We study the effect of financial literacy on financial inclusion at the cross country level. Financial literacy is strongly related to higher financial inclusion (i.e. access and use of fin. services) and IV-regressions support a causal interpretation.Studying heterogeneous effects of financial literacy across countries shows that the marginal effect of financial literacy on financial inclusion is largest in countries with lower income, a less developed financial sector, and fewer bank branches. |
| JEL: | G21 O1 E44 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc17:168165&r=pay |
| By: | Philippe Bacchetta |
| Abstract: | The Sovereign Money Initiative will be submitted to the Swiss people in 2018. This paper reviews the arguments behind the initiative and discusses its potential impact. I argue that several arguments are inconsistent with empirical evidence or with economic logic. In particular, controlling sight deposits neither stabilizes credit nor avoids financial crises. Also, assuming that deposits at the central bank are not a liability has implications for fiscal and monetary policy; and Benes and Kumhof (2012) do not provide support for the reform as they do not analyze the proposed Swiss monetary reform and their closed-economy model does not fit the Swiss economy. Then, using a simple model with monpolistically competitive banks, the paper assesses quantitatively the impact of removing sight deposits from commercial banks balance sheets. Even though there is a gain for the state, the overall impact is negative, especially because depositors would face a negative return. Moreover, the initiative goes much beyond what would be the equivalent of full reserve requirement and would impose severe constraints on monetary policy; it would weaken financial stability rather then reinforce it; and it would threaten the trust in the Swiss monetary system. Finally, there is high uncertainty both on the details of the reform and on its impact. |
| Keywords: | Reserve requirements; sovereign money; money creation |
| JEL: | E42 E51 E41 |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:lau:crdeep:17.16&r=pay |
| By: | Nicola Dimitri (Professor of Economics, University of Siena-Italy, Corvers Chair on Innovation Procurement, Maastricht School of Management, Life Member, Clare Hall College Cambridge, Visiting Professor IMT) |
| Abstract: | In the paper we analyse the current EU public procurement legislation on innovative solutions from an economic perspective. In particular, for contracting authorities interested in procuring products which are not yet in the market we identify two main options, based on whether or not they decide to unbundle the procurement of R&D services from that of the final product. Taking the point of view of both the competing firms and the contracting authorities we discuss economic advatanges and limitations of the two options. We specifically focus on the R&D stage arguing that to develop an innovative solution selected firms may compete, but also collaborate. |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:msm:wpaper:2017/1&r=pay |
| By: | László Bodnár (Magyar Nemzeti Bank (Central Bank of Hungary)) |
| Abstract: | Since the 2008 economic crisis, network research has become increasingly prominent in the world of finance. The complex interrelations and financial interdependencies formed among financial market participants have proved to be critical in times of crisis. In this paper, we explore the network properties of the Hungarian RTGS (VIBER) and also seek an answer to the question of whether the network properties of the system have changed over the long term across the time windows considered, and if so, to what extent. Furthermore, we identify systemically important participants using a variety of network theory tools. We also explore methodologies which – by providing new perspectives for monitoring the evolution of systemically important participants – may contribute to improving the effectiveness of oversight in Hungary. To identify systemically important participants, we apply four methodologies, namely: the LSI index, the model capturing the relation of eigenvector and betweenness, diffusion centrality, and the model exploring the effect of combining multiple nodes. In the Hungarian RTGS, two distinct groups emerge: the first is comprised of participants that play a key role in the transmission of liquidity (“core”), and the other is the cluster of periphery participants. As the composition of the core has remained virtually unchanged, it can be considered stable. While the risk of contagion arising from an operational disruption increased at both the individual and aggregated level during the period under review, it is also apparent that no such link exists in the graph the removal of which would ultimately cut the communication between the banks originally connected by it. The results of each indicator showed that there were no significant changes regarding the network properties across the three time windows, confirming the robustness of the network properties of the Hungarian RTGS and its stability over time. |
| Keywords: | Hungarian RTGS (VIBER), network research, financial networks, graph theory, topology, centrality indices, systemically important financial institutions (SIFI) |
| JEL: | D85 E42 E5 G2 G21 L14 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:mnb:opaper:2017/132&r=pay |
| By: | Fischer, Stanley (Board of Governors of the Federal Reserve System (U.S.)) |
| Date: | 2017–10–05 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgsq:973&r=pay |
| By: | Mechtenberg, Lydia; Büchel, Berno |
| Abstract: | We study private communication in social networks prior to a majority vote on two alternative policies. Some (or all) agents receive a private imperfect signal about which policy is correct. They can, but need not, recommend a policy to their neighbors in the social network prior to the vote. We show that communication can undermine effciency of the vote and hence reduce welfare in a common interest setting. We test the model in a lab experiment and find strong support for the predicted effects. |
| JEL: | D72 D83 D85 C91 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc17:168094&r=pay |