Alt tag
Bank of Canada economist Jiaqi Li will be presenting at this seminar. The Economic Speaker Series is a free lecture and discussion series.

Central Bank Digital Currency and Banking Choices

Economics Speaker Series Seminar will feature Jiaqi Li, Bank of Canada economist


Date: Friday, March 3
Time: 3 pm
Location: Arts 106

About this event

Bank of Canada economist Jiaqi Li will be presenting at this Economics Speaker Series Seminar. 

To what extent does a central bank digital currency compete with traditional financial institutions? We develop and empirically estimate a structural model where each household decides in which institution to deposit their liquid digital balance, taking into account the utilities from holding liquid assets (in cash and digital money) and from potentially taking out a mortgage, in addition to the branch networks.

While financial institutions tend to provide higher utilities from liquid asset holdings through higher deposit rates and from the complementarity between deposit accounts and loans, a non-interest-bearing CBDC that does not provide lending services can still have nonnegligible impacts on financial institutions by providing better branch networks. We find that if every (no) bank branch is a service location for CBDC, it can crowd out the deposits by 28.9% (1.2%) on average across banks. However, introducing even a very large holding limit on CBDC can significantly reduce its uptake.

Upcoming Events

Allison Hrabluik: The Splits

May 17 - Aug 30, 2024
A video work intersecting documentary and fiction

Jeff Thomas: I Refuse to be Invisible

May 10 - Sep 27, 2024
Photos exploring historical and contemporary representations of Indigenous identity


See all events