Arbeitspapier
On the Equivalence of Private and Public Money
When does a swap between private and public money leave the equilibrium allocation and price system unchanged? To answer this question, the paper sets up a generic model of money and liquidity which identifies sources of seignorage rents and liquidity bubbles. We derive sufficient conditions for equivalence and apply them in the context of the “Chicago Plan”, cryptocurrencies, the Indian de-monetization experiment, and Central Bank Digital Currency (CBDC). Our results imply that CBDC coupled with central bank pass-through funding need not imply a credit crunch nor undermine financial stability.
- Language
-
Englisch
- Bibliographic citation
-
Series: CESifo Working Paper ; No. 7741
- Classification
-
Wirtschaft
Money and Interest Rates: General
Monetary Policy, Central Banking, and the Supply of Money and Credit: General
General Financial Markets: General (includes Measurement and Data)
National Budget, Deficit, and Debt: General
- Subject
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money creation
monetary system
inside money
outside money
equivalence
CBDC
Chicago Plan
sovereign money
- Event
-
Geistige Schöpfung
- (who)
-
Brunnermeier, Markus K.
Niepelt, Dirk
- Event
-
Veröffentlichung
- (who)
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Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2019
- Handle
- Last update
-
10.03.2025, 11:44 AM CET
Data provider
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Brunnermeier, Markus K.
- Niepelt, Dirk
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2019
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