Towards a cashless economy: Economic and socio-political implications

Nissim Cohen; Anna Rubinchik; Labib Shami

doi:10.1016/j.ejpoleco.2019.101820

Towards a cashless economy: Economic and socio-political implications

Nissim Cohen, Anna Rubinchik, Labib Shami

University of Haifa

Research output: Contribution to journal › Article › peer-review

Abstract

We construct a simple general equilibrium model to demonstrate how eliminating cash can lead to a misallocation of resources in a naturally segmented economy with observed (official) and non-observed (informal) sectors. The source of inefficiency mirrors the standard arguments explaining why money is essential: a promise backed by a good produced in one sector can not be used in another and so absence of a reliable fiat money reduces the gains from trade. We also point to several additional unintended consequences of cash elimination.

Original language	American English
Article number	101820
Journal	European Journal of Political Economy
Volume	61
DOIs	https://doi.org/10.1016/j.ejpoleco.2019.101820
State	Published - 1 Jan 2020

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 17 Partnerships for the Goals

Keywords

Cash
Money
Segmented markets
Shadow economy

All Science Journal Classification (ASJC) codes

Economics and Econometrics
Political Science and International Relations

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10.1016/j.ejpoleco.2019.101820

Cite this

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KW - Segmented markets

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Towards a cashless economy: Economic and socio-political implications

Abstract

UN SDGs

Keywords

All Science Journal Classification (ASJC) codes

Access to Document

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