Liñares-Zegarra, José M and Willesson, Magnus (2021) The effects of negative interest rates on cash usage: Evidence for EU countries. Economics Letters, 198. p. 109674. DOI https://doi.org/10.1016/j.econlet.2020.109674
Liñares-Zegarra, José M and Willesson, Magnus (2021) The effects of negative interest rates on cash usage: Evidence for EU countries. Economics Letters, 198. p. 109674. DOI https://doi.org/10.1016/j.econlet.2020.109674
Liñares-Zegarra, José M and Willesson, Magnus (2021) The effects of negative interest rates on cash usage: Evidence for EU countries. Economics Letters, 198. p. 109674. DOI https://doi.org/10.1016/j.econlet.2020.109674
Abstract
Changes in interest rates below the zero lower bound could have potential effects on the payments market by making cash more attractive for consumers as a medium of payment and wealth storage. This paper studies how cash usage has been affected by the recent introduction of negative interest rates in European countries. Using a difference-in-differences methodology over the period 2006 - 2018, results show an increase in cash usage in negative interest-rate environments. We also find that the increase in cash usage was less pronounced in countries with superior monitoring capacity of banks (i.e. high levels of financial intermediation).
Item Type: | Article |
---|---|
Uncontrolled Keywords: | Negative interest rates; Europe; Cash; Bank monitoring; Financial intermediation |
Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Essex Business School |
SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
Depositing User: | Unnamed user with email elements@essex.ac.uk |
Date Deposited: | 27 Nov 2020 16:51 |
Last Modified: | 16 May 2024 20:37 |
URI: | http://repository.essex.ac.uk/id/eprint/29207 |
Available files
Filename: Pre-proof EL.pdf
Licence: Creative Commons: Attribution-Noncommercial-No Derivative Works 3.0