Abstract
The theoretical studies dealing with the efficiency of monetary denomination systems are usually based on a restrictive assumption: cash transactions are assumed to be evenly distributed in the economy. Using an empirical (observed) distribution of cash transactions in the French economy, this paper compares the efficiency of the European currency system using the observed and the uniformation distributions of cash transactions. We show that the degree of competition between payment instruments, the high proportion of low-value and rounded cash transactions in the observed distribution of cash transactions improve the efficiency of the European currency system with respect to the one obtained with the uniform distribution.
| Translated title of the contribution | Distribution of cash transactions and efficient payments in euro |
|---|---|
| Original language | French |
| Pages (from-to) | 737-748 |
| Number of pages | 12 |
| Journal | Revue Economique |
| Volume | 64 |
| Issue number | 4 |
| DOIs | |
| Publication status | Published - 30 Sept 2013 |