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on Payment Systems and Financial Technology |
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Issue of 2024‒03‒11
thirty-two papers chosen by |
| By: | Marco Reuter |
| Abstract: | I study an entrepreneur’s incentives to build a decentralized platform using a blockchain. The entrepreneur can either build the platform using a regular company and retain control of the platform, or build the platform using a blockchain and surrender control of the platform. In either case, the platform’s users experience a locked-in effect. I show that a decentralized implementation of the platform is both (i) more profitable for the entrepreneur and (ii) a Pareto improvement, if and only if the size of the locked-in effect exceeds some threshold. Further, progressive decentralization through airdrops can be optimal. |
| Keywords: | blockchain; smart contracts; decentralization; cryptocurrency; commitment; platforms |
| Date: | 2024–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2024/028&r=pay |
| By: | Xiaorui Zuo; Yao-Tsung Chen; Wolfgang Karl H\"ardle |
| Abstract: | In the burgeoning realm of cryptocurrency, social media platforms like Twitter have become pivotal in influencing market trends and investor sentiments. In our study, we leverage GPT-4 and a fine-tuned transformer-based BERT model for a multimodal sentiment analysis, focusing on the impact of emoji sentiment on cryptocurrency markets. By translating emojis into quantifiable sentiment data, we correlate these insights with key market indicators like BTC Price and the VCRIX index. This approach may be fed into the development of trading strategies aimed at utilizing social media elements to identify and forecast market trends. Crucially, our findings suggest that strategies based on emoji sentiment can facilitate the avoidance of significant market downturns and contribute to the stabilization of returns. This research underscores the practical benefits of integrating advanced AI-driven analyses into financial strategies, offering a nuanced perspective on the interplay between digital communication and market dynamics in an academic context. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2402.10481&r=pay |
| By: | Celene Ancalle (Central Reserve Bank of Peru); Maria Gracia Garcia (Central Reserve Bank of Peru) |
| Abstract: | Interoperability is the characteristic of a payment service (e.g. digital wallets) to allow its users to pay any person or company, regardless of the financial institution providing services to the payer or payee. On October 7, 2022, the Central Reserve Bank of Peru (BCRP) issued the Payment Services Interoperability Regulation to massify digital payments in the country. The main objective of this research is to study the impact of interoperability, promoted through regulation, on the use of digital payments. We analyzed transactional data provided daily by market participants in the interoperability regulation, and data obtained from digital wallet users through a survey. The results suggest that interoperability has contributed to increase the use of digital payments, but there are other factors such as fees, user experience and quality of service that can impact the adoption and use of interoperable payment services. Furthermore, our analysis shows that interoperability benefited more individuals in regions with a higher degree of financial inclusion, i.e. financial inclusion is key to benefiting from interoperability. These results serve as a basis for validating, adjusting, and reorienting the future regulatory strategies of the BCRP, aimed at fostering greater adoption and use of digital payments; as well as to guide other payment authorities seeking to implement effective digital payments regulations, drawing lessons from the Peruvian experience. |
| Keywords: | Interoperability; regulation; digital payments; financial inclusion; Peru |
| JEL: | E42 E58 E61 E65 G28 |
| Date: | 2024–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:gii:giihei:heidwp02-2024&r=pay |
| By: | Victor Budau; Herve Tourpe |
| Abstract: | This working paper inaugurates the "Technology Fundamentals for Digital Finance" series, concentrating on the technical aspects of financial Digital Assets. The series aims to facilitate the use of a clear terminology in a nascent platform-oriented paradigm of financial infrastructures, by laying the groundwork for technical discussions on digital asset standards. The paper introduces a conceptual model named ASAP (Access, Service, Asset, Platform) for Digital Asset Platforms (DAP), leveraging insights from IT industry practices and experiments by central banks. The ASAP model is illustrated through examples and use cases of tokenized assets, to demonstrate the possible usage and merits of modeling Digital Asset Platforms with four layers. Just as the utilization of a seven-layer model (often refered to as TCP/IP) has been fundamental to the interoperability of the internet, it is anticipated that the four-layer ASAP model for Digital Asset Platforms will similarly promote cross-platform interoperability, including across various jurisdictions, paving the way for a more cohesive digital asset ecosystem. |
| Keywords: | digital asset; platform; conceptual model; service; tokenization; tokenized asset; interoperability; technical standards; platform-enabled finance; fintech; CBDC; unbundling; open banking |
| Date: | 2024–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2024/019&r=pay |
| By: | Makarov, Igor; Schoar, Antoinette |
| Abstract: | The paper provides an overview of cryptocurrencies and decentralized finance (DeFi). The discussion lays out potential benefits and challenges of the new system and presents a comparison to the traditional system of financial intermediation. Our analysis highlights that while the DeFi architecture might have the potential to reduce transaction costs, similar to the traditional financial system, there are several layers where rents can accumulate due to endogenous constraints to competition. We show that the permissionless and pseudonymous design of DeFi generates challenges for enforcing tax compliance and anti–money laundering laws and preventing financial malfeasance. We highlight ways to regulate the DeFi system which would preserve a majority of benefits of the underlying blockchain architecture but support accountability and regulatory compliance. |
| Keywords: | AAM requested |
| JEL: | J1 J50 |
| Date: | 2022–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117711&r=pay |
| By: | Saul Estrin; Susanna Khavul; Alexander S. Kritikos; Jonas Löher |
| Abstract: | Financing entrepreneurship spurs innovation and economic growth. Digital financial platforms that crowdfund equity for entrepreneurs have emerged globally, yet they remain poorly understood. We model equity crowdfunding in terms of the relationship between the number of investors and the amount of money raised per pitch. We examine heterogeneity in the average amount raised per pitch that is associated with differences across three countries and seven platforms. Using a novel dataset of successful fundraising on the most prominent platforms in the UK, Germany, and the USA, we find the underlying relationship between the number of investors and the amount of money raised for entrepreneurs is loglinear, with a coefficient less than one and concave to the origin. We identify significant variation in the average amount invested in each pitch across countries and platforms. Our findings have implications for market actors as well as regulators who set competitive frameworks. |
| Keywords: | equity crowdfunding, soft information, entrepreneurship, finance, financial access and inclusion |
| JEL: | D26 G23 G41 L26 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp2064&r=pay |
| By: | Tania Babina; Saleem A. Bahaj; Greg Buchak; Filippo De Marco; Angus K. Foulis; Will Gornall; Francesco Mazzola; Tong Yu |
| Abstract: | Open banking (OB) empowers bank customers to share transaction data with fintechs and other banks. 49 countries have adopted OB policies. Consumer trust in fintechs predicts OB policy adoption and adoption spurs investment in fintechs. UK microdata shows that OB enables: i) consumers to access both financial advice and credit; ii) SMEs to establish new fintech lending relationships. In a calibrated model, OB universally improves welfare through entry and product improvements when used for advice. When used for credit, OB promotes entry and competition by reducing adverse selection, but higher prices for costlier or privacy-conscious consumers partially offset these benefits. |
| JEL: | G21 G23 G24 G28 G5 G50 K21 L10 L51 O31 O36 O38 O50 |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32089&r=pay |
| By: | Gabriele Coletti (Bank of Italy); Alberto Di Iorio (Bank of Italy); Emanuele Pimpini (Bank of Italy); Giorgia Rocco (Bank of Italy) |
| Abstract: | This report presents findings for Italy from the ‘Study on the payment attitudes of consumers in the euro area (SPACE) – 2022’, conducted by the European Central Bank between the end of 2021 and the first half of 2022. The primary aim of the report is to provide updated information on the prevailing trends in the use of payment methods in Italy. Additionally, where applicable and useful, the report compares Italy’s results with those of the euro area and with data from the previous run of the survey, conducted in 2019, and from the ‘Study on the use of cash by households in the euro area’ (SUCH), conducted in 2015-16. The data show that, while cash remains the dominant payment method at the Point of Sale (POS), especially for low-value purchases (up to €50), its overall usage has declined in comparison with the findings of the previous editions of the survey. In terms of value of transactions, non-cash payments have gained importance, accounting for more than half of total expenditures at POS. Cashless payments are increasing overall, supported also by an uptake in e-commerce purchases. Specifically, cards, besides being the greatest competitor of cash for POS transactions, continue to be the most used means of payment both in terms of number and value of transactions for online purchases. |
| Keywords: | payment instruments, cash, payment habits, consumers’ payment behaviour |
| JEL: | D12 D14 |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wpmisp:mip_042_23&r=pay |
| By: | Carla Ioana Ana Maria Popescu (University of Bucharest, Romania) |
| Abstract: | This essay explores the ethical considerations surrounding the use of social media platforms and their detrimental impact on mental health. With the proliferation of social media in today's interconnected world, it is crucial to critically examine the ethical implications of these platforms. The essay delves into the various ways in which social media can contribute to the mental health crisis, such as through increased exposure to cyberbullying, unrealistic body image standards, and constant social comparison. By analyzing the role of social media companies in the dissemination of harmful content and the potential ethical responsibilities they bear, this essay provides insights into the moral obligations of platform owners and the need for stricter regulations. By comprehensively analyzing the ethical dimensions of social media's impact on mental health, this essay aims to foster a broader conversation and inspire action for a more responsible and compassionate digital future. |
| Keywords: | Ethics of social media, Applied ethics, Social media, Mental health, Addiction |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:raiswp:0342&r=pay |
| By: | Mr. Serhan Cevik |
| Abstract: | The rise of fintech is revolutionizing the financial landscape, with products and companies advancing innovative technologies to improve and automate financial services. In this paper, I use a novel dataset and implement a dynamic modelling to investigate the relationship between fintech and economic growth in a panel of 198 countries over the period 2012–2020. This cross-country approach—utilizing direct measures of fintech and dealing with potential endogeneity—provides interesting empirical insights. First, the impact magnitude and statistical significance of fintech on real GDP per capita growth depend on the type of instrument (digital lending vs. digital capital raising). While digital lending has a statistically significant positive effect on economic growth, digital capital raising has a large but insignificant effect. Second, the overall impact of fintech including all instruments is positive and statistically significant because of the overwhelming share of digital lending in total. Finally, while the positive relationship between fintech and growth is stronger in magnitude in advanced economies, the statistical significance of this effect is higher in developing countries. Taken as a whole, these results confirm Schumpeter’s prediction that financial innovation can promote growth, but not every type of fintech becomes an accelerator. |
| Date: | 2024–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2024/020&r=pay |
| By: | Hadiza Wada (Kaduna State University, Nigeria) |
| Abstract: | The contemporary realities of media production and use have brought about the need for media literacy, which has emerged as a subject matter in both the academics and public square. The popularity and pervasiveness of user-generated content in the form of citizen journalism, social media, alternative media, and others have invaded the once professionally processed information, whose sources are known and vetted by proud and logo-embossed media outlets. The result has forced on the world the need to train consumers of media content to become literate and discern for themselves the facts from the lies and the useful from the useless. This paper analyzes the causes that made media literacy binding, its methodology, and most directly, the need for a review of journalism education content and processes to match the contemporary mindset of the digital generation of students. |
| Keywords: | Media literacy, new media effects, media education, social media effects |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:raiswp:0317&r=pay |
| By: | Erdong Chen; Mengzhong Ma; Zixin Nie |
| Abstract: | This study presents a groundbreaking Systematization of Knowledge (SoK) initiative, focusing on an in-depth exploration of the dynamics and behavior of traders on perpetual future contracts across both centralized exchanges (CEXs), and decentralized exchanges (DEXs). We have refined the existing model for investigating traders' behavior in reaction to price volatility to create a new analytical framework specifically for these contract platforms, while also highlighting the role of blockchain technology in their application. Our research includes a comparative analysis of historical data from CEXs and a more extensive examination of complete transactional data on DEXs. On DEX of Virtual Automated Market Making (VAMM) Model, open interest on short and long positions exert effect on price volatility in opposite direction, attributable to VAMM's price formation mechanism. In the DEXs with Oracle Pricing Model, we observed a distinct asymmetry in trader behavior between buyers and sellers. Such asymmetry might stem from uninformed traders reacting more strongly to positive news than to negative, leading to a tendency to accumulate long positions. This study sheds light on the potential risks and advantages of using perpetual future contracts within the DeFi space while provides mathematical basis and empirical insights based on which future theoretical works can be configurated, offering crucial insights into the rapidly evolving world of blockchain-based financial instruments. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2402.03953&r=pay |
| By: | Derrick, Fossong; Mc Moi Ndi, Ashu; Santoro, Fabrizio |
| Abstract: | Many African countries have made significant progress in digitalising tax administration. Recent research has shown promising evidence around the impact of digital solutions, such as electronic filing, on tax compliance and revenue generation. Very little, however, is known about how digitalisation could strengthen local tax administration, and how subnational government levels could benefit from broader national digitalisation reforms. The case of Cameroon illustrates how local tax administrations can struggle to benefit from technology. The digital tax policy (DTP) was adopted in Cameroon in 2014 and went fully into effect in 2016. The reform introduced an online declaration and payment system, accessible through the web portal of the Directorate General of Taxes (DGT), the national tax administration. The reform also heavily focussed on pre-filling tax returns. With the information it has on taxpayers’ business activities, income and assets, the tax administration automatically issues a pre-filled tax return form. In turn, taxpayers, accessing the pre-filled form online, only have to confirm the information on it if they find it is accurate. If not, they have to amend the form online. Further, the web portal permits taxpayers to make their payments digitally, through a bank or electronically. Summary of African Tax Administration Paper 33. |
| Keywords: | Finance, Technology, |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:18233&r=pay |
| By: | Katrin Assenmacher; Massimo Ferrari Minesso; Arnaud Mehl; Maria Sole Pagliari |
| Abstract: | We develop a two-country DSGE model with financial frictions to study the transi- tion from a steady-state without CBDC to one in which the home country issues a CBDC. The CBDC provides households with a liquid, convenient and storage-cost- free means of payments which reduces the market power of banks on deposits. In the steady-state CBDC unambiguously improves welfare without disintermediating the banking sector. But macroeconomic volatility in the transition period to the new steady-state increases for plausible values of the latter. Demand for CBDC and money overshoot, thereby crowding out bank deposits and leading to initial declines in investment, consumption and output. We use non-linear solution meth- ods with occasionally binding constraints to explore how alternative policies reduce volatility in the transition, contrasting the effects of restrictions on non-residents, binding caps, tiered remuneration and central bank asset purchases. Binding caps reduce disintermediation and output losses in the transition most effectively, with an optimal level of around 40% of steady-state CBDC demand. |
| Keywords: | Central bank digital currency, open-economy DSGE models, steady- state transition, occasionally binding constraints |
| JEL: | E50 E58 F30 F41 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:803&r=pay |
| By: | Jeffrey Allen; Richard Alley; Amber Seira; Cy Watsky |
| Abstract: | A permissionless blockchain network is a system of physically distributed computers running a copy of a shared ledger and using the same software rules that enable all network participants to “read, submit, and validate transactions” (Beck, Müller-Bloch, and King, 2018, p. 1022). A permissionless system’s accessibility stands in contrast to that of permissioned systems, in which a central authority pre-selects validators and potentially restricts viewing and submission rights (Krause, Natarajan, and Gradstein, 2017; Beck, Müller-Bloch, and King, 2018). |
| Date: | 2024–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfn:2024-02-09&r=pay |
| By: | Joël Cariolle (FERDI - Fondation pour les Etudes et Recherches sur le Développement International, CERDI - Centre d'Études et de Recherches sur le Développement International - IRD - Institut de Recherche pour le Développement - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne); Yasmine Elkhateeb (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, Department of Economics, Faculty of Economics and Political Science, Cairo University); Mathilde Maurel (FERDI - Fondation pour les Etudes et Recherches sur le Développement International, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | The use of the Internet to access news has an impact on African citizens' perceptions of democracy. Using repeated cross-sectional data from the Afrobarometer survey across 35 African countries over the period 2011-2018, along with an instrumental variable approach, allows addressing potential endogeneity bias between Internet use and citizens' perceptions. The results indicate that using the Internet to obtain information has a significant negative effect on both the preference for and the perception of the extent of democracy. This negative effect is due to several factors. First, Internet use erodes trust in government institutions, mainly in the parliament and the ruling party. It increases the perception that parliament members are involved in corruption. In addition, the erosion of trust is correlated with more political mobilization, in the form of greater participation in demonstrations and voting. These results echo the existing literature and, in particular, hint at the risks of reversal of nascent democratization processes. Finally, the Internet seems to act as a misinformation channel. On the one hand, Internet users' perception of the extent of democracy and perception of the corruption of legislators diverge from experts' assessments. On the other hand, Internet use increases the likelihood of inconsistency in respondents' stances on their preference for democracy. The Internet is not a neutral information channel: it tends to undermine citizens' preference for democracy while also altering perceptions about political institutions. |
| Keywords: | Internet, Democracy, Misinformation, Africa, Media & democracy |
| Date: | 2024–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04423752&r=pay |
| By: | Yulu Gong; Mengran Zhu; Shuning Huo; Yafei Xiang; Hanyi Yu |
| Abstract: | In the age of the Internet, people's lives are increasingly dependent on today's network technology. However, network technology is a double-edged sword, bringing convenience to people but also posing many security challenges. Maintaining network security and protecting the legitimate interests of users is at the heart of network construction. Threat detection is an important part of a complete and effective defense system. In the field of network information security, the technical update of network attack and network protection is spiraling. How to effectively detect unknown threats is one of the concerns of network protection. Currently, network threat detection is usually based on rules and traditional machine learning methods, which create artificial rules or extract common spatiotemporal features, which cannot be applied to large-scale data applications, and the emergence of unknown threats causes the detection accuracy of the original model to decline. With this in mind, this paper uses deep learning for advanced threat detection to improve cybersecurity resilienc e in the financial industry. Many network security researchers have shifted their focus to exceptio n-based intrusion detection techniques. The detection technology mainly uses statistical machine learning methods - collecting normal program and network behavior data, extracting multidimensional features, and training decision machine learning models on this basis (commonly used include naive Bayes, decision trees, support vector machines, random forests, etc.). In the detection phase, program code or network behavior that deviates from the normal value beyond the tolerance is considered malicious code or network attack behavior. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2402.09820&r=pay |
| By: | Ozili, Peterson K |
| Abstract: | Artificial intelligence (AI) is a topic of interest in the finance literature. However, its role and implications for central banks have not received much attention in the literature. Using discourse analysis method, this article identifies the benefits and risks of artificial intelligence in central banking. The benefits of artificial intelligence for central banks are that deploying artificial intelligence systems will encourage central banks to develop information technology (IT) and data science capabilities, it will assist central banks in detecting financial stability risks, it will aid the search for granular micro economic/non-economic data from the internet so that the data can support central banks in making policy decisions, it enables the use of AI-generated synthetic data, and it enables task automation in central banking operations. However, the use of artificial intelligence in central banking poses some risks which include data privacy risk, the risk that using synthetic data could lead to false positives, high risk of embedded bias, difficulty of central banks to explain AI-based policy decisions, and cybersecurity risk. The article also offers some considerations for responsible use of artificial intelligence in central banking. |
| Keywords: | central bank, artificial intelligence, financial stability, responsible AI, artificial intelligence model. |
| JEL: | E51 E52 E58 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120151&r=pay |
| By: | Banga, Karishma; Beyleveld, Alexander |
| Abstract: | African countries are currently considering provisions in the AfCFTA and at the WTO to liberalise digital trade. As they face mounting fiscal pressures, it is imperative that they beware the implications of digital trade provisions for their ability to tax their digital economy. In this paper, we develop a comprehensive framework for analysing the impact of trade rules on tax regimes in the digital economy, with a focus on Kenya, Rwanda, and South Africa. We explore how trade rules ostensibly shape tax policies and their implications for revenue generation. By examining rules regulating trade in services and the imposition of customs duties on electronic transmissions, we identify how these rules may directly impact tax policies and limit revenue generation possibilities. Moreover, digital trade rules, such as those related to data flows, localisation, and source code sharing, have the capacity to produce both indirect and administrative effects on tax measures. These rules can alter tax structures, taxation rights, data collection, and the capacity to monitor and implement tax measures. Our findings shed light on the complex interplay between trade rules and tax measures, highlighting potential challenges and opportunities for revenue generation from the digital economy in African countries. |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:18223&r=pay |
| By: | Maggie Scordel (Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar); Florence Jacob (Nantes Univ - IAE Nantes - Nantes Université - Institut d'Administration des Entreprises - Nantes - Nantes Université - pôle Sociétés - Nantes Univ - Nantes Université, LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Nantes Univ - IAE Nantes - Nantes Université - Institut d'Administration des Entreprises - Nantes - Nantes Université - pôle Sociétés - Nantes Univ - Nantes Université) |
| Abstract: | This study focuses on the in-store experience in a smart retailing context, which is characterized by technological innovations. The in-store promotional and nutritional notifications are studied there, as well as their perception during a display and ultimately their effect on purchase intention, and on the feelings of brands intrusion via these notifications. In the field of Mobile In-Store Experience, more experiential data collection methods are called in the literature to deeply understand consumer behaviors. We choose a qualitative design with in-depth semidirective interviews including projective technics thanks to innovative dynamic and adaptative video. Our personalized video material simulates an immersive in-store shopping sequence. This methodology can reproduce conditions very close to reality to catch customer behavior. It seems to offer a new way to study the experience with a simple and inexpensive material. Moreover, our results highlight the importance of the choice process for customer, the relevance of message, and the perceived brand technology congruence. |
| Keywords: | in-store experience smart retailing qualitative methodology projective method innovativeness, in-store experience, smart retailing, qualitative methodology, projective method, innovativeness |
| Date: | 2023–06–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04437009&r=pay |
| By: | Giuseppe Amato (Bank of Italy); Simone Ciccarone (Bank of Italy); Pasquale Digregorio (Bank of Italy); Giuseppe Natalucci (Bank of Italy) |
| Abstract: | In recent years, more and more organizations have been building up or enhancing their own Cyber Threat Intelligence (CTI) capability. Financial entities need to improve their own cyber resilience posture to face the ever-expanding range of money-driven or state sponsored threat actors aiming to undermine the stability of targeted countries by compromising their financial infrastructures. At the same time, the digital transformation process and steadily growing information sharing initiatives make a huge amount of data available for CTI analysis. International committees related to Financial Market Infrastructures (FMI), via commonly agreed policies or directives, and EU institutions, through normative initiatives, are firmly committed to improving the cybersecurity posture of FMIs. To this end, one of the main lines of action is to increase information sharing among financial entities. The large number of heterogeneous information sources and the overwhelming quantity and variety of available data could have negative impacts on the efficiency of CTI activities and compromise the effectiveness of defence capabilities. Therefore, the consolidation and automation of CTI processes must be prioritized in order to improve the effectiveness and sustainability of CTI operations. However, the definition and automation of CTI processes is still at a rather immature stage: for example, well-established and vendor-neutral best practices do not yet exist. The present paper proposes a framework, developed and adopted by the Computer Emergency Response Team of Banca d’Italia (CERTBI) that integrates a taxonomy and specific processes to develop an enhanced CTI capability. |
| Keywords: | CTI service architecture, CTI service components, information triage, intelligence case, technical investigation, security orchestration and automation |
| JEL: | F50 O33 G20 L50 M15 |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wpmisp:mip_043_23&r=pay |
| By: | Julia M. Puaschunder (Columbia University, USA) |
| Abstract: | One of the most studied behavioral economics effects is the endowment effect. If people are asked to pay for a normal good (e.g., like a mug or pen), the price they offer tends to be lower than if they are given the same good and asked for what price they are willing to sell the good. The endowment effect is believed to stem from the value imbued in possession and the expectation to hold onto the possession once a good is acquired. The psychological effect of self-determination on the motivation of people has been studied in psychology for a long time. Self-determined decisions hold positive advantages of people getting a positive boost from their own volition. Self-determined people tend to follow with through their plans and work longer and better on tasks than those who just fulfill externally-imposed goals. The endowment effect and self-determined decisions may underlie the fascination of co-creation online. Online luxury worlds have been booming in the last decade. Virtual co-creation in homepages, blogs, social online media and video self-streaming platforms has created a new source of social and monetary value as never before in the history of humankind. Social online media influencers are now one of the most prominent career choices in the upcoming generation. This paper attempts to connect the endowment effect with self-determined co-creation online effects, which appears to take the economy over by storm. The paper offers a first glimpse of the new phenomenon. Human rights online and ethical predicament in internet markets will be discussed, as well as future research avenues on the topic. |
| Keywords: | Co-creation online, Economics, Endowment Effect, Law & Economics, Luxury, Online, Self-determined Decisions, Virtual Markets |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:raiswp:0318&r=pay |
| By: | Johann Lussange; Stefano Vrizzi; Stefano Palminteri; Boris Gutkin |
| Abstract: | Building on a previous foundation work (Lussange et al. 2020), this study introduces a multi-agent reinforcement learning (MARL) model simulating crypto markets, which is calibrated to the Binance's daily closing prices of $153$ cryptocurrencies that were continuously traded between 2018 and 2022. Unlike previous agent-based models (ABM) or multi-agent systems (MAS) which relied on zero-intelligence agents or single autonomous agent methodologies, our approach relies on endowing agents with reinforcement learning (RL) techniques in order to model crypto markets. This integration is designed to emulate, with a bottom-up approach to complexity inference, both individual and collective agents, ensuring robustness in the recent volatile conditions of such markets and during the COVID-19 era. A key feature of our model also lies in the fact that its autonomous agents perform asset price valuation based on two sources of information: the market prices themselves, and the approximation of the crypto assets fundamental values beyond what those market prices are. Our MAS calibration against real market data allows for an accurate emulation of crypto markets microstructure and probing key market behaviors, in both the bearish and bullish regimes of that particular time period. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2402.10803&r=pay |
| By: | Insaf Jouiet (Faculté des sciences juridiques économiques et sociales de Oujda Université Mohammed Premier, Oujda, Maroc); Ahlam Maaraf (Faculté des sciences juridiques économiques et sociales de Oujda Université Mohammed Premier, Oujda, Maroc) |
| Abstract: | Attracting and engaging profitable customers for participation banks services is one of the major challenges facing the banking industry nowadays. In this context, this study aims to explore and investigate the main factors that influence customers' intention to adopt participation banks in the Moroccan context. To achieve the research objective, a conceptual model was designed based on the diffusion of innovation theory of Rogers (2003) and an exploratory qualitative study conducted based on a sample of twenty active customers of conventional banks and non-users of participation banking services. Following the proposed model, the relative advantage, the compatibility, the observability, the trialability and the social influence are assumed to have a positive and significant influence on the consumers' intention to adopt participation banking services, while the complexity and the uncertainty are assumed to influence negatively the consumers behavioural intention. It is noteworthy that previous literature is quite limited on this matter, especially in the Moroccan case where participation banks have been recently launched in this country, which enhances the studies conducted in this context. In addition, participation banks can use the results of this study to implement effective marketing strategies to increase the adoption and use of participation banking services by Moroccan consumers. |
| Abstract: | Attirer et engager des clients rentables pour les services des banques participatives est l'un des principaux défis auxquels l'industrie bancaire est confrontée de nos jours. Dans ce contexte, cette étude vise à explorer et à étudier les principaux facteurs qui influencent l'intention des clients d'adopter les banques participatives dans le contexte marocain. Pour atteindre l'objectif de la recherche, un modèle conceptuel a été conçu sur la base de la théorie de la diffusion de l'innovation de Rogers (2003) et une étude qualitative exploratoire a été menée sur la base d'un échantillon de vingt clients actifs de banques conventionnelles et de non-utilisateurs de services bancaires participatifs. Selon le modèle proposé, l'avantage relatif, la compatibilité, l'observabilité, la possibilité d'essai et l'influence sociale sont supposés avoir une influence positive et significative sur l'intention des consommateurs d'adopter les services bancaires participatifs, tandis que la complexité et l'incertitude sont supposées influencer négativement l'intention comportementale des consommateurs. Il convient de noter que la littérature antérieure est assez limitée sur ce sujet, en particulier dans le cas du Maroc où les banques participatives ont été récemment lancées dans ce pays, ce qui renforce les études menées dans ce contexte. En outre, les banques participatives peuvent utiliser les résultats de cette étude pour mettre en œuvre des stratégies de marketing efficaces afin d'accroître l'adoption et l'utilisation des services bancaires participatifs par les consommateurs marocains. |
| Keywords: | Adoption Participation bank, Participation bank, Diffusion of innovation theory, Participation bank morocco |
| Date: | 2023–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04427772&r=pay |
| By: | Michelle W. Bowman |
| Date: | 2024–02–15 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgsq:97754&r=pay |
| By: | Jorge Serrano-Malebrán; Jorge Arenas-Gaitán |
| Abstract: | El auge del comercio social y el uso redes sociales para transacciones comerciales han permitido experimentar con nuevos formatos de anuncios en redes sociales móviles para promover sus productos como los “anuncios comprables”. El objetivo de esta investigación es presentar y examinar las relaciones potenciales entre las características de este nuevo formato de anuncio sobre la confianza, actitudes, e intención de utilizar anuncios comprables de productos de moda en redes sociales móviles. Se han utilizado como antecedentes las percepciones de los usuarios sobre las actividades de Actividades de Marketing en Redes Sociales (SMMA): personalización, informatividad, interactividad, tendencia y boca a boca. Se aplicó un cuestionario a usuarios redes sociales móviles, logrando una muestra de 486 encuestados para su análisis mediante el enfoque de modelado de ecuaciones estructurales. Los resultados demuestran que las actividades de marketing en redes sociales tienen un efecto sobre tres elementos: la confianza, las respuestas actitudinales, y la intención de comprar a través de anuncios comprables de productos de moda en redes sociales móviles. |
| Keywords: | Comercio social, marketing en redes sociales, anuncios, moda |
| JEL: | M31 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:ovr:docfra:2402&r=pay |
| By: | Fabrizio Colella (USI University); Keith Maskus (University of Colorado at Boulder); Alessandro Peri (University of Colorado at Boulder) |
| Abstract: | Tighter money-laundering regulations in offshore financial havens may inadvertently spur incentives to launder money domestically. Our study exploits regulations targeting financially based money laundering in Caribbean jurisdictions to uncover the creation of front companies in the United States. We find that counties exposed via offshore financial links to these jurisdictions experienced an increase in business activities after the tightening of anti-money-laundering regulations. The effect is more pronounced among small firms, in sectors at high risk of money laundering, and in regions with high intensities of drug trafficking. Our work provides the first empirical evidence of the real effects of policy-induced money-laundering leakage. |
| Keywords: | Money laundering, money-laundering leakage, business establishments, offshore leaks, regulatory reforms, monopolistic competition |
| JEL: | F30 K40 G28 H00 D58 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:2403&r=pay |
| By: | ZHU Chen; MOTOHASHI Kazuyuki |
| Abstract: | Startups have emerged as pivotal innovators in the commercialization of AI technology. Nonetheless, these nascent enterprises often require substantial capital infusion to realize the economic returns from their innovations. This study examines the role of prototypes in facilitating their fundraising process. We utilized historical web content to identify the presence of prototypes and employed web traffic data to monitor their customer growth. Our findings indicate that prototyping positively affects the potential customer attraction process, signaling the feasibility and profitability of their business hypotheses to potential investors. In addition, as a technologically intensive industry, most AI startups begin with a technology-centric approach. While a technology-led starting point underscores competitiveness, it also inherently introduces uncertainty. We offer quantitative evidence demonstrating how prototyping acts as a moderating factor, reducing the impact of such uncertainty by expediting investor decision-making. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:24021&r=pay |
| By: | Taylor Reynolds; Sarah Scheffler; Daniel J. Weitzner; Angelina Wu |
| Abstract: | There are two strategic and longstanding questions about cyber risk that organizations largely have been unable to answer: What is an organization's estimated risk exposure and how does its security compare with peers? Answering both requires industry-wide data on security posture, incidents, and losses that, until recently, have been too sensitive for organizations to share. Now, privacy enhancing technologies (PETs) such as cryptographic computing can enable the secure computation of aggregate cyber risk metrics from a peer group of organizations while leaving sensitive input data undisclosed. As these new aggregate data become available, analysts need ways to integrate them into cyber risk models that can produce more reliable risk assessments and allow comparison to a peer group. This paper proposes a new framework for benchmarking cyber posture against peers and estimating cyber risk within specific economic sectors using the new variables emerging from secure computations. We introduce a new top-line variable called the Defense Gap Index representing the weighted security gap between an organization and its peers that can be used to forecast an organization's own security risk based on historical industry data. We apply this approach in a specific sector using data collected from 25 large firms, in partnership with an industry ISAO, to build an industry risk model and provide tools back to participants to estimate their own risk exposure and privately compare their security posture with their peers. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2402.04166&r=pay |
| By: | Guangsheng Yu; Qin Wang; Caijun Sun; Lam Duc Nguyen; H. M. N. Dilum Bandara; Shiping Chen |
| Abstract: | In this paper, we study how to optimize existing Non-Fungible Token (NFT) incentives. Upon exploring a large number of NFT-related standards and real-world projects, we come across an unexpected finding. That is, the current NFT incentive mechanisms, often organized in an isolated and one-time-use fashion, tend to overlook their potential for scalable organizational structures. We propose, analyze, and implement a novel reference incentive model, which is inherently structured as a Directed Acyclic Graph (DAG)-based NFT network. This model aims to maximize connections (or references) between NFTs, enabling each isolated NFT to expand its network and accumulate rewards derived from subsequent or subscribed ones. We conduct both theoretical and practical analyses of the model, demonstrating its optimal utility. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2402.06459&r=pay |
| By: | Julia M. Puaschunder (Columbia University, USA) |
| Abstract: | The contemporary finance literature is focused on monetary assets and financial instruments. In a holistic approach, this article draws attention to humane features of capital in outlining the influence of a healthy lifestyle and biohacking on personal wealth. The COVID-19 pandemic raised awareness for healthy lifestyles as panacea to avoid viral complications as well as drove people to consult online information sources about healthcare as never before in the history of humankind. Previous work has connected health and capital on the individual, nuclear family level, corporate community standards and conduct as well as the overall economy. This paper focuses on the new trend of Ecowellness Biohacking. The term Ecowellness derives from ecological (as pertaining to nature) wellness. Wellness became prominent in the 1980s as a combination of Wellbeing and Fitness. Wellness is thereby the active practice of healthy habits (such as sports but also nutrition and mindfulness) on a daily basis to attain better physical and mental health outcomes. Ecowellness stresses the connection with nature for the wellbeing. Active Ecowellness trends include the transformation of the healthcare system through holistic approaches in nutrition, prevention, supplements and sports. Biohacking has recently become a prominent term in integrating biology, genetics, neuroscience and nutrition to enhance physical and mental performance as well as improve health and well-being. As a newly forming phenomenon since the early 2000s, biohacking comprises multiple fields such as nutrigenomics, do-it-yourself-biology and grinders. Nutrigenomics studies the effects of nutrients on the expression of an individual’s genetic makeup and encompasses nutritional factors that protect the genome from damage. Do-it-yourself biology (DIY biology) is a biotechnological social movement, in which laymen/women are studying biological effects of life sciences with traditional research methods on their own. Do-it-yourself biology thereby comprises of bioinformatics projects that use programming; genetic engineering that makes use of big data from biology; open source medical experimentation; grinders who use technological implants or introduce chemicals to the body to influence body functions; as well as mostly modern tech-supported arts to achieve body outcomes. As the Ecowellness Biohacking trend is currently evolving, little attention has been paid to the economic impetus of Ecowellness Biohacking. Some suggestions are given about the business model of health-and-wellness-lifestyle coaching, but no clear economic model exists today that helps evaluate and discount the long-term value of Ecowellness Biohacking for the individual and society. This article first discusses the new trend of Ecowellness Biohacking to then estimate some of the positive impacts of the trend on the overall health, wellbeing and monetary success of individuals as well as the economic influence of Ecowellness Biohacking. The discussion is dedicated to address the potential but also the risks associated with this new trend of Ecowellness Biohacking. |
| Keywords: | Bioasset, Biohacking, Banking, Big data, Economics, Economics of Arts, Ecowellness, Finance, Grinders, Health, Healthcare, Investment, Law & Economics, Money, Multiplier, Precaution, Prevention, Socially Responsible Investment |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:smo:raiswp:0328&r=pay |
| By: | Siebenbrunner, Christoph; Taudes, Alfred |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus051:60608200&r=pay |