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on Payment Systems and Financial Technology |
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Issue of 2020‒02‒03
nineteen papers chosen by |
| By: | Marcelo Álvez (Banco Central del Uruguay); Rodrigo Lluberas (Banco Central del Uruguay); Jorge Ponce (Banco Central del Uruguay) |
| Abstract: | The incorporation of new technologies to financial activities imply challenges and opportunities to financial authorities. They are reacting to the unavoidable trend towards digitalization of financial activities with the objective of preserving stable and efficient payment and financial systems. Uruguay, for instance, has promoted the use of electronic payment instruments and tested in the real economy a central bank digital currency called e-Peso. Digitalization of payment systems would reduce transaction costs by (partially) replacing less efficient means of payment, e.g. paper-cash and checks. In this paper we find that the cost of using cash in Uruguay is approximately 0.61% of GDP. Interestingly, 98.1% of this cost is borne by the private sector: banks and retailers 77.1% and households 21.0%. The cost of using checks is equivalent to 0.04% of GDP. Overall, replacing paper-cash and checks by other (electronic) means of payment would imply a transaction cost reduction for the private sector of the equivalent of up to 0.65% of GDP. |
| Keywords: | payment system, cost of cash, cost of checks, electronic payments; sistema de pagos, costo del dinero, costo del cheque, pagos electrónicos |
| JEL: | D12 D23 D24 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:bku:doctra:2019004&r=all |
| By: | Anil Savio Kavuri; Alistair Milne |
| Abstract: | This paper is an examination of adoption of distributed ledgers in financial services. We review more than one hundred initiatives and a large practitioner literature, considering fourteen areas of application and seven case studies, in order to provide both a conceptual analysis of these technologies and to review their current and prospective adoption in financial services. There are several component technologies applied in distributed ledger, many offering substantial commercial and operational benefits even applied outside of a distributed ledger and best viewed as part of the broader picture of ongoing digitalization of financial services using various data technologies. Our findings suggest that decision makers can take a pragmatic approach to distributed ledgers, not be concerned about this technology upending their business but be open to cross industry co-operation where this is strategically justified and to then adopt what works to improve outcomes for customers and other stakeholders. Overall, distributed ledgers and crypto assets, are really a distraction from the wider and more important issues of ongoing digitisation and automation of financial services. Data sharing and cross industry co-operation – as well as well as enlightened public policy to promote adoption of new technologies, competition and prudential and systemic safety – are crucial to this digital revolution. This does not depend on widespread adoption of distributed ledgers. |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2020-04&r=all |
| By: | Bertani, Filippo; Raberto, Marco; Teglio, Andrea |
| Abstract: | Since the last 30 years, the economy has been undergoing a massive digital transformation. Intangible digital assets, like software solutions, web services, and more recently deep learning algorithms, artificial intelligence and digital platforms, have been increasingly adopted thanks to the diffusion and advancements of information and communication technologies. Various observers argue that we could rapidly approach a technological singularity leading to explosive economic growth. The contribution of this paper is on the empirical and the modelling side. First, we present a cross-country empirical analysis assessing the correlation between intangible digital assets and different measures of productivity. Then we figure out their long-term impact on unemployment under different scenarios by means of an agent-based macro-model. |
| Keywords: | Intangible assets, Digital transformation, Total factor productivity, Technological unemployment, Agent-based economics |
| JEL: | C63 |
| Date: | 2020–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:98233&r=all |
| By: | Ngasuko, Tri Achya |
| Abstract: | The latest Susenas survey in 2018 states that urban residents over the age of five years and overuse the internet more. In 2018, urban internet users were 70%, and the remaining 30% are in rural areas. However, the 2017 Susenas survey stated that internet users in rural areas are still 28%. Thus, the use of the internet by rural communities also increased from the previous period, and rural communities began to utilize the internet in their daily lives. It turns out that the use of the internet will also drive the economy so that there is economic potential, and ultimately there is potential for state revenue, such as taxes. This short-paper tries to see if the Indonesian government can succeed in collecting taxes from economic activities in cyberspace. By using library research methods, this paper reveals that it turns out that Great Britain is the first country to tax Google successfully. However, the amount paid was relatively small, which was around 20.4 million pounds in 2013, whereas the value of sales made by Google at that time reached 3.8 billion pounds. In 2015, Indonesia finally became the fourth country to succeed in getting taxes from Google besides the UK, India, and Australia. However, the amount of tax revenue is not stated. The findings of this short-paper are as a first step to explore further the potential of state revenue from digital economic activities. |
| Keywords: | digital economy, state income , susenas 2018, Indonesia |
| JEL: | G28 H20 H26 |
| Date: | 2019–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:98265&r=all |
| By: | Shorish, Jamsheed (Shorish Research) |
| Abstract: | We present a formalization of blockchain as a state machine, focusing upon permissionless blockchains due to general audience awareness of its most popular implementation, Bitcoin (permissioned blockchains are treated similarly without loss of generality). After presenting a typical Bitcoin transaction workflow, a general blockchain state representation is derived. It is demonstrated that the proper mathematical object defining the state of a blockchain is a topological fiber bundle, because it is not possible to globally `parametrize' blocks (or ledgers of blocks) by time due to their dependence upon cryptographic hash functions. In addition, we specify a general transition function between blockchain states that is agnostic to the consensus mechanism used to write blocks into the ledger, and which is probabilistic in nature, so that blockchain may be regarded as a probabilistic state machine. We then interpret agents (both human and code-based, such as `chaincode', `smart contracts', or other artificial intelligence) as automata interacting with blockchain technology, drawing upon the theory of non-cooperative repeated interaction games. Finally, blockchain as a hierarchy of state machines is defined, and future research directions are presented using this hierarchy as a point of departure for modeling blockchain dynamics. |
| Date: | 2018–01–23 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:eusxg&r=all |
| By: | Tri Achya, Ngasuko |
| Abstract: | The latest Susenas survey in 2018 states that urban residents over the age of 5 years and overuse the internet more. In 2018, urban internet users were 70%, and the remaining 30% are in rural areas. However, the 2017 Susenas survey stated that internet users in rural areas are still 28%. Thus, the use of the internet by rural communities also increased from the previous period, and rural communities began to utilize the internet in their daily lives. It turns out that the use of the internet will also drive the economy so that there is economic potential, and ultimately there is potential for state revenue, such as taxes. This short-paper tries to see if the Indonesian government can succeed in collecting taxes from economic activities in cyberspace. By using library research methods, this paper reveals that it turns out that Great Britain is the first country to tax Google successfully. However, the amount paid was relatively small, which was around 20.4 million pounds in 2013, whereas the value of sales made by Google at that time reached 3.8 billion pounds. In 2015, Indonesia finally became the fourth country to succeed in getting taxes from Google besides the UK, India, and Australia. However, the amount of tax revenue is not stated. The findings of this short-paper are as a first step to explore further the potential of state revenue from digital economic activities. |
| Keywords: | digital economy, state income , susenas 2018, Indonesia |
| JEL: | G28 H20 H26 |
| Date: | 2019–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:98259&r=all |
| By: | Stockhinger, Jan; Teubner, Alexander |
| Abstract: | Through out the last decade, digitalization has fundamentally transformed the business world and put into question traditional strategy wisdom. As (digital) information technologies (IT) are the drivers of this transformation, we can expect it to have an even more profound influence on IT/IS strategy thinking. While several scholars have acknowledged the fundamental changes induced by digitalization on the conceptual level, research on emerging IT/IS strategy contents is still missing. This paper intends to fill this gap by revealing both practically relevant and theoretically valid concerns worth considering when developing IT/IS strategies for/in the digital age. Based on a working definition of digitalization, we present a set of hypotheses on how IT/IS strategies might respond to trends in digitalization. We also put these hypotheses to discussionin ten interviews with IT/IS managers in practice. Our research adds to a better understanding of the complex phenomenon of digitalization and its implications for IT/IS strategy development. Our research responds to calls for a stronger focus on strategy contents and more practice-oriented IT/IS strategy research. |
| Keywords: | Digitalization,digital transformation,IT/IS strategy,information infrastructure strategy,information function strategy,IT/IS strategy contents |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ercisw:31&r=all |
| By: | Diekhof, Josefine; Eckl, Verena; Krieger, Bastian; Licht, Georg; Nguyen, Thu-Van; Peters, Bettina; Rammer, Christian; Stenke, Gero |
| Abstract: | The exchange of knowledge between science and industry has been a focus of innovation research and policy for many decades. New developments in the way technologies are generated, shared, and transferred into new products, services, and business models are currently re-emphasising science-industry interactions. Main drivers are the emergence of open innovation models, the increased internationalisation of innovation processes, the rise of digital platforms, new modes of governance in public research, and the enlarged role of disruptive innovations. At the same time, the measurement of knowledge flows is still limited, and indicators on recent trends in science-industry interaction are lacking. This limits innovation policy in monitoring changes and addressing challenges. A conference in October 2019 in Berlin brought together industry representatives, researchers, and policy makers to discuss these developments and how the measurement of science-industry links could be improved. This policy brief summarises key trends in science-industry collaborations, presents existing indicators and discusses ways to improve our indicator system on knowledge flows between science and industry in order to better inform policy. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewpbs:92019&r=all |
| By: | Thanasis Stengos (Department of Economics and Finance, University of Guelph, Guelph ON Canada); Theodore Panagiotidis (Department of Economics, University of Macedonia); Orestis Vravosinos (Department of Economics, New York University) |
| Abstract: | We examine the significance of fourty-one potential covariates of bitcoin returns for the period 2010–2018 (2,872 daily observations). The principal component-guided sparse regression is employed, introduced by Tay et al. (2018). We reveal that economic policy uncertainty and stock market volatility are among the most important variables for bitcoin. We also trace strong evidence of bubbly bitcoin behavior in the 2017-2018 period. |
| Keywords: | bitcoin; cryptocurrency; bubble; sparse regression; LASSO; PC-LASSO; principal component; flexible least squares |
| JEL: | G12 G15 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:gue:guelph:2020-01&r=all |
| By: | Catalin VRABIE (National University of Political Studies and Public Administration, Romania) |
| Abstract: | A main characteristic of smart cities is the use of information and communications technology in all aspects of city life. In this regard, Internet of Things (IoT) is a core element in the process of developing communities “ruled” by an improved communication, better understanding and wait times decrease. This paper aims to present the ways in which IoT networks and services can contribute to develop smart cities, giving as example various cities that have implemented this concept. The methodology used to carry out this research is both bibliographic – opting here to study the work of specialists in the field, authors from Romania and abroad, and empirical – formed by a case study on various smart cities around the world that use IoT. This type of smart cities is starting to transform all public institutions, changing their culture, from one control-based to one performance-centered. IoT is starting to play an important role in smart cities’ evolution and it brings an improvement in the government-citizens relationship. We have identified that although technology is a central element, there should also be considered the capability and willingness of citizens and public institutions to collaborate in order to implement the best solutions for the communities. |
| Keywords: | future cities, IoT, smart cities. |
| JEL: | H83 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:rom:tadase:7&r=all |
| By: | Halkiopoulos, Constantinos; Antonopoulou, Hera; Papadopoulos, Dimitrios; Giannoukou, Ioanna; Gkintoni, Evgenia |
| Abstract: | Tourism is one of the fastest growing industries worldwide and in general, the Internet continues to gain importance in the tourism sector. The study focuses on exploration of knowledge of online booking systems and on the views of local students-users concerning the booking rate based on these online systems. Another perspective of this project is to investigate the decision-making process (emotion-focused) that they follow in order to choose a tourist destination via online booking systems. For the purposes of this study, three scales were administered E-WOM and Accommodation Scale, Emotion-Based Decision-Making Scale and Trait Emotional Intelligence Scale. Then, survey data were collected, preprocessed and analyzed based on Data Mining techniques evaluating the results. More specifically, classification and association algorithms were utilized to manage to describe hidden patterns. E-Tourism will continue to be oriented towards the consumers and the technology that surrounds them, providing dynamic communication in electronic business. |
| Keywords: | Online Booking Systems, Hotel Selection Factors, e-Tourism, Expert System |
| JEL: | D7 L81 L83 |
| Date: | 2020–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:98230&r=all |
| By: | Young, Mischa; Farber, Steven |
| Abstract: | Convenience and low prices have enabled ride-hailing companies, such as Uber and Lyft, to position themselves amongst the most valuable companies within the transportation sector. They now account for the lion share of activities in the platform economy and play an increasing role within our cities. Despite this, very little is known about the type of people that use them, nor the purpose and timing of trips. In addition to this, their effect on other modes, such as taxis and public transit, remains, for the most part, widely unexplored. By comparing the socioeconomic and trip characteristics of ride-hailing users to that of other mode users, we find ride-hailing to be a wealthy younger generation phenomenon. While our results show that ride-hailing is too minute and inconsequential to influence the ridership level of other more substantial modes of travel overall, when considering specific market segments, the rise of ride-hailing corresponds to a significant decrease in taxi ridership and a rise in active modes of travel. Moreover, due to the specific age, timing, and purpose of our subsample, we believe that ride-hailing may effectively reduce drunk-driving, and are convinced that as this mode increases in importance in the future, it will have a much more pronounced effect on the level of ridership of other modes as well. |
| Date: | 2019–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:x7ryj&r=all |
| By: | Anderson, Donald N. (Southwest University of Visual Arts) |
| Abstract: | The spread of GPS-based location services using smartphone applications has led to the rapid growth of new startups offering smartphone-enabled dispatch service for taxicabs, limousines, and ridesharing vehicles. This change in communicative technology has been accompanied by the creation of new categories of car service, particularly as drivers of limousines and private vehicles use the apps to provide on-demand service of a kind previously reserved for taxicabs. One of the most controversial new models of car service is for-profit ridesharing, which combines the for-profit model of taxi service with the overall traffic reduction goals of ridesharing. A preliminary attempt is here made at understanding how for-profit ridesharing compares to traditional taxicab and ridesharing models. Ethnographic interviews are drawn on to illustrate the range of motivations and strategies used by for-profit ridesharing drivers in San Francisco, California as they make use of the service. A range of driver strategies is identified, ranging from incidental, to part-time, to full-time driving. This makes possible a provisional account of the potential ecological impacts of the spread of this model of car service, based on the concept of taxicab efficiency, conceived as the ratio of shared vs. unshared miles driven. |
| Date: | 2018–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:yw6nx&r=all |
| By: | Hyun Hak Kim (Department of Economics, Kookmin University); Hosung Jung (Economic Research Institute, Bank of Korea) |
| Abstract: | We investigate a network of financial institutions in Korea using the Korea Consumer Credit Panel (KCCP). The main contribution of this paper is that we construct the network of financial institution from the consumer credit level. We assume each consumer make a loan from multiple institutions so that those institutions share same risk from same consumer no matter of quality or type of loan. Then we construct the financial network between institutions and compute contagion index based on those multiple connection with a weight of default probability of individual borrowers. We found strong connection with banking institutions and credit card firms due to convenience in making small-amount loans with credit cards. However, when we give an weight with default probability to the linkage among institutions, connections of banking institution with savings bank, non-credit card finance corporation and merchant banking are stronger than others, while banking institution holds center position and has biggest amount of loans individually. Contagion index hit a peak in 2013Q1 and then fell rapidly, finally has been fluctuated in relatively low level from 2016 to 2017Q2. The result in our paper enables the authority to watch the systemic risk from consumer credit level with specific consumer type with their default probability. |
| Keywords: | Systemic risk, Financial network, Consumer credit, Financial stability |
| JEL: | C23 D14 G20 G21 G23 |
| Date: | 2019–09–17 |
| URL: | http://d.repec.org/n?u=RePEc:bok:wpaper:1923&r=all |
| By: | Bindseil, Ulrich |
| Abstract: | IT progress and its application to the financial industry have inspired central banks and academics to analyse the merits of central bank digital currencies (CBDC) accessible to the broad public. This paper first reviews the advantages and risks of such CBDC. It then discusses two prominent arguments against CBDC, namely (i) risk of structural disintermediation of banks and centralization of the credit allocation process within the central bank and (ii) risk of facilitation systemic runs on banks in crisis situations. Two-tier remuneration of CBDC is proposed as solution to both issues, and a comparison is provided with a simple cap solution and the solution of Kumhof and Noone (2018). Finally, the paper compares the financial account implications of CBDC with the ones of crypto assets, Stablecoins, and narrow bank digital money, in a domestic and international context. JEL Classification: E3, E5, G1 |
| Keywords: | central bank digital currencies, central banks, financial accounts, financial instability |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20202351&r=all |
| By: | Walid Mensi (College of Economics and Political Science, Sultan Qaboos University); Shawkat Hammoudeh (Lebow College of Business, Drexel University, Philadelphia, United States); Aviral Kumar Tiwari (Montpellier Business School, Montpellier, France); Khamis Hamed Al-Yahyaee (Department of Economics and Finance, College of Economics and Political Science, Sultan Qaboos University) |
| Abstract: | This paper examines the left and right tail dependence-switching structure between twelve MENA stock markets, and oil and other major global factors. We compare the MENA–oil tail dependence with that of Bitcoin, gold, and VIX. Using a recent combined wavelet and dependence-switching copula approach, we show evidence of significant tail dependence between MENA stock markets and oil and the other global factors. The dependence structure varies across the associated different regimes and under both the short- and long-term horizons. Moreover, the safe haven role of gold is more apparent in the long term than in the short term for all MENA markets, and this result is similar for Bitcoin but is less evident for VIX. We conclude by providing policy implications. |
| Date: | 2019–09–20 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1345&r=all |
| By: | Vladi Finotto (Dept. of Management, Università Ca' Foscari Venice); Christine Mauracher (Dept. of Management, Università Ca' Foscari Venice); Isabella Procidano (Dept. of Management, Università Ca' Foscari Venice) |
| Abstract: | Understanding the determinants of users’ propensity to purchase goods online is urgent for firms in the food industry. The present paper aims at analyzing how socio-demographic traits and characteristics influence consumers’ propensity to buy online. More specifically, the paper aims at understanding whether there are any differences or similarities in online purchases of food and beverage items vis-à-vis the purchases of non-food items. We find that a variety of socio-demographic characteristics influence online buying behavior and do soin nuanced ways. As far as food purchases are concerned, we find that males, aged 40-49 are more inclined to buy food and beverage online. While age and gender explain online shopping for food and beverage, other variables, such as education and place of residence, play a role in explaining the propensity to buy online non-food items. Several indications related to the preferences of customers in terms of additional services are proffered throughout the paper. |
| Keywords: | e-commerce; online shopping; food and beverage |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:vnm:wpdman:171&r=all |
| By: | Mumtaz, Salma Athallah |
| Abstract: | Review The Development of Digital Economy In Indonesia |
| Date: | 2019–11–27 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:jecyu&r=all |
| By: | Federica Alberti (Portsmouth Business School); Anna Conte (Sapienza University of Rome); Daniela T. Di Cagno (LUISS Guido Carli University); Emanuela Sciubba (Birkbeck University of London) |
| Abstract: | Our social lives are governed by trust. But how do we choose whom to trust? In this work, based on a laboratory experiment, we explore whether building relationships in a social network increases individuals' level of trust. We find that social interactions direct trust, but their impulse is not sufficiently strong to result beneficial. |
| Keywords: | Social network, Trust, Lab experiment |
| JEL: | C72 C91 C92 D82 D85 |
| Date: | 2020–01–24 |
| URL: | http://d.repec.org/n?u=RePEc:pbs:ecofin:2020-02&r=all |