Template-Type: ReDIF-Paper 1.0
Title: Currency Competition With Firms
Author-Name: Maxi Guennewig
Author-Email: mguennewig@uni-bonn.de
Classification-JEL: E4, E5, G2
Keywords: Digital Currencies, Currency Competition, Seignorage Information, Facebook, Monetary Policy

Abstract: This paper analyses the consequences for monetary policy if firms issue money which generates
seignorage revenues and information on consumers. I present a benchmark economy with a
unique monetary equilibrium in which firms form digital currency areas if information rents are
large. The central bank loses its autonomy and is forced to implement deflationary monetary
policy. I extend the benchmark to show that the central bank may regain policy autonomy
when firms form currency consortia with decision powers and claims on seignorage concentrated
in the hands of one firm.

Note: 
Length: 46
Creation-Date: 2022-12
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp378
File-Format: application/pdf
Handle: RePEc:bon:boncrc:CRCTR224_2022_378