Central Bank Digital Money
Material type:
Continuing resourcePublication details: Economic and Political Weekly; 2024Description: 41-50Subject(s): Online resources: Summary: While the usage and introduction of central bank digital currency is of recent origin, conceptually central bank digital money has always existed in the form of central bank reserves. We develop the modern view of the monetary process originating in the flow of CBDM as credit to the private sector. Money is the wage cost of firms for originating production. Workers spend their incomes on consumption goods. The expenditure accrues as profits to firms that honour their commitments, with interest, to the central bank. The reserve rate is the price of money. We derive the general equilibrium of the model. A firewall is erected between CBDM and CBDC.
| Item type | Current library | Vol info | Status | Barcode | |
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Article Index
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Dr VKRV Rao Library | Vol. 59, No. 21 | Not for loan | AI207 |
While the usage and introduction of central bank digital currency is of recent origin, conceptually central bank digital money has always existed in the form of central bank reserves. We develop the modern view of the monetary process originating in the flow of CBDM as credit to the private sector. Money is the wage cost of firms for originating production. Workers spend their incomes on consumption goods. The expenditure accrues as profits to firms that honour their commitments, with interest, to the central bank. The reserve rate is the price of money. We derive the general equilibrium of the model. A firewall is erected between CBDM and CBDC.
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