Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
This paper provides a structured overview of the burgeoning literature on the economics of central bank digital currency (CBDC). We document the economic forces that shape the rise of digital money and review motives for the issuance of CBDC. We then study the implications for the financial system and discuss a number of policy issues and challenges. While the academic literature broadly echoes policymakers’ concerns about bank disintermediation and financial stability risks, it also provides conditions under which such adverse effects may not materialize. We also point to several knowledge gaps that merit further work, including data privacy and the study of end-user preferences for attributes of digital payment methods.