Dirty money: Does the risk of infectious disease lower demand for cash?

Cevik, Serhan

doi:10.1111/infi.12383

Cited by 22 publications

(17 citation statements)

References 34 publications

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“…The dependent variable is the nominal cash in circulation as a share of nominal GDP, which is frequently used in the literature (Armelius et al 2021;Cevik 2020). Using the share of nominal cash in circulation in nominal GDP is beneficial for three reasons.…”

Section: Data Sources and Research Methodologymentioning

confidence: 99%

“…In some studies, the importance of the shadow economy for cash demand is not confirmed (Jobst and Stix 2017a;Takala and Viren 2010) or the results are mixed (Deutsche Bundesbank 2019; Seitz et al 2018). The role of the shadow economy has been confirmed in various studies Goodhart 2020a, 2020b;Cevik 2020;Reimers et al 2020). In all these studies, the Multiple Indicator-Multiple Cause (MIMIC) model was adopted, and the authors adopted the share of the self-employed in total employment, VAT rates, and cigarette consumption as variables allowing estimates of the shadow economy.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Unfortunately, there are no studies yet that explain this phenomenon in the context of COVID-19. Cevik (2020) examined the effects of earlier pandemics and showed that the spread of infectious diseases (such as ebola and SARS) lowers demand for physical cash. However, we saw the opposite effect in the initial period of COVID-19.…”

Section: Literature Reviewmentioning

confidence: 99%

“…There are only a few published empirical studies that have attempted to test hypotheses about the determinants of the increase in the use and holding of cash. Most of them date back to the pre-COVID-19 era (Ashworth and Goodhart 2020b;Stix 2017a, 2017b;Liñares-Zegarra and Willesson 2021;Reimers et al 2020;Titova et al 2021;Rösl and Seitz 2021;Cevik 2020;Armelius et al 2021). In particular, low interest rates have been proposed in the discussion as a key determinant of the growing importance of cash (Liñares-Zegarra and Willesson 2021; Jobst and Stix 2017a).…”

Section: Introductionmentioning

confidence: 99%

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Drivers of the Cash Paradox

Pietrucha

2021

Risks

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An upward trend in the share of cash in GDP has been observed since the beginning of the 21st century and has not yet been fully explained in the literature. In fact, the interest rate is the only variable that has been well researched and well confirmed as a determinant of the cash/GDP ratio. The novelty of this study is primarily considering new determinants of the share of cash in GDP (including in particular monetization and financial development), as well as testing the significance of uncertainty and institutions. The data cover the period 2001–2020 for 82 countries. The most important conclusions include: the share of cash in GDP is primarily dependent on its lagged values (payment habits) and the ultra-loose monetary policy of central banks. However, some other variables also contribute to this process—such as monetization and crises in the real economy.

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Section: Data Sources and Research Methodologymentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Drivers of the Cash Paradox

Pietrucha

2021

Risks

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“…The latter include , , Coyle et al (2021), Chen et al (2020), Auer et al (2020), Wisniewski et al (2021). Cevik (2020) shows that the risk of infection reduced the demand for cash. Using highfrequency transaction data, Ardizzi et al (2020) find that cash use declined and card use increased in Italy during COVID.…”

Section: Literature Reviewmentioning

confidence: 99%

Untitled

2022

rdr

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The COVID-19 pandemic has caused large changes in consumer spending, including how people make their payments. We use data from a nationally representative survey of US consumers collected before the pandemic in 2018 and 2019 and in 2020 to analyze changes in consumer payment behavior during the pandemic. We find that compared with their payment behavior in 2019, consumers had shifted some of their purchases from in person to online by fall 2020, significantly lowered their use of cash for purchases, and shifted their person-to-person (P2P) payments away from paper (cash and checks). Those changes are consistent with what we might expect, as many people were less able or willing to shop in person. The adoption of electronic P2P increased, especially the use of payment apps such as PayPal, Venmo, and Zelle. Consumers who worked exclusively from home during COVID made significantly higher shares of their payments online or through mobile devices and were less likely to use cash at all compared with those who worked at least partly in person, even after we control for income and education levels. In contrast, payment-behavior changes that took place from 2018 to 2019 were smaller in magnitude and largely insignificant, suggesting that COVID likely accelerated any longer-term trends. Although it is too soon to determine whether these changes will persist for the longer term, we observed them several months after the onset of the pandemic, so they certainly were not just temporary shifts.

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Challenges for ATM management in times of market variability caused by the COVID-19 pandemic crisi

Suder

Wójtowicz

Kusa

et al. 2022

Cent Eur J Oper Res

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One of the most important issues related to the management of an Automatic Teller Machine (ATM) network is the correct forecasting of the demand for cash. Typically, this demand, expressed as the value or number of ATM withdrawals, has some regularities that can be used to evaluate future values for these variables. However, forecasting becomes a challenge when a crisis occurs that could affect the behavior of ATM users. In this context, it is important to identify how the development of the crisis and the various information concerning it may affect people’s attitudes to cash.This study aims to examine the impact of the COVID-19 pandemic on the behavior of ATM customers. On the basis of daily data from 81 ATMs, we analyze the changes in the value and number of withdrawals just before and during the COVID-19 pandemic in Poland. An event study analysis allows us to determine precisely the moments in which changes in user behavior took place. This means that it is also possible to examine the reaction of ATM users to the announcement and implementation of the pandemic restrictions, and to determine the factors that had an impact on the change in people’s attitude to cash. Such a study is also important from a sociological point of view, as it enables one to understand people’s reactions to the emerging crisis. Hence, its results may be useful not only for managers of ATM networks, but also for various authorities and policy makers.

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Dirty money: Does the risk of infectious disease lower demand for cash?

Cited by 22 publications

References 34 publications

Drivers of the Cash Paradox

Drivers of the Cash Paradox

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Challenges for ATM management in times of market variability caused by the COVID-19 pandemic crisi

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