Who Should Make Kroner?

A Review of Danmarks Nationalbank's Analysis of CBDC

Ole Bjerg, Rasmus Hougaard Nielsen

Publikation: Working paperForskning

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Resumé

This paper is a review of Danmarks Nationalbank's recent analysis of the prospects of implementing a Central Bank Digital Currency (CBDC) in Denmark. We concur with Nationalbanken's conclusion that CBDC does not add efficiency or further functionality to existing payment solutions. We argue, however, that their analysis fails to take into account the potentials for increased financial stability given the fact that CBDC carries no credit risk. We also find that Nationalbanken's dismissal of CBDC on the grounds that it does not provide new monetary policy tools, since interest rates are bound by the fixed exchange rate regime, fails to consider the value of CBDC in the event of a future crisis. Finally, we argue that the Nationalbanken's views may reflect a primary concern with the preservation of the existing banking sector in its current form over and above the needs of the general public.
OriginalsprogEngelsk
Udgivelses stedFrederiksberg
UdgiverCopenhagen Business School, CBS
Antal sider27
StatusUdgivet - 2018
NavnWorking Paper
NummerFebruary 2018

Citer dette

Bjerg, O., & Hougaard Nielsen, R. (2018). Who Should Make Kroner? A Review of Danmarks Nationalbank's Analysis of CBDC. Frederiksberg: Copenhagen Business School, CBS. Working Paper, Nr. February 2018
Bjerg, Ole ; Hougaard Nielsen, Rasmus. / Who Should Make Kroner? A Review of Danmarks Nationalbank's Analysis of CBDC. Frederiksberg : Copenhagen Business School, CBS, 2018. (Working Paper; Nr. February 2018).
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abstract = "This paper is a review of Danmarks Nationalbank's recent analysis of the prospects of implementing a Central Bank Digital Currency (CBDC) in Denmark. We concur with Nationalbanken's conclusion that CBDC does not add efficiency or further functionality to existing payment solutions. We argue, however, that their analysis fails to take into account the potentials for increased financial stability given the fact that CBDC carries no credit risk. We also find that Nationalbanken's dismissal of CBDC on the grounds that it does not provide new monetary policy tools, since interest rates are bound by the fixed exchange rate regime, fails to consider the value of CBDC in the event of a future crisis. Finally, we argue that the Nationalbanken's views may reflect a primary concern with the preservation of the existing banking sector in its current form over and above the needs of the general public.",
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Bjerg, O & Hougaard Nielsen, R 2018 'Who Should Make Kroner? A Review of Danmarks Nationalbank's Analysis of CBDC' Copenhagen Business School, CBS, Frederiksberg.

Who Should Make Kroner? A Review of Danmarks Nationalbank's Analysis of CBDC. / Bjerg, Ole; Hougaard Nielsen, Rasmus.

Frederiksberg : Copenhagen Business School, CBS, 2018.

Publikation: Working paperForskning

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Bjerg O, Hougaard Nielsen R. Who Should Make Kroner? A Review of Danmarks Nationalbank's Analysis of CBDC. Frederiksberg: Copenhagen Business School, CBS. 2018.