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№ 3/2021

№ 3/2021

Fìnansi Ukr. 2021 (3): 7–22
https://doi.org/10.33763/finukr2021.03.007

SCIENTIFIC DISCUSSIONS

KOZIUK Viktor 1

1West Ukrainian National University
OrcID ID : https://orcid.org/0000-0002-5715-2983


Readiness to introduce digital currency: is the central bank independence important?


The paper put forward the hypothesis suggesting that central bank’s advances on the way of CBDC projects depend on the level of their independence. At the same time, the theory demonstrates some ambiguity of how to interpret independence in respect of CBDC involvement especially in the case of empirical tests because indexes of central banks independence are tailored to the assessment of relations between monetary authorities’ status and inflation. A high level of the central bank independence index rank may mean a narrow focus on monetary policy, while a low level of independence may mean a lack of resources to be allocated to execute the innovative projects. To avoid such theoretic ambiguity in the empirical test the linearly and quadratic functions are applied in the case of the central bank independence proxy. Such proxy is added by proxies for economic development, innovations and financial development. The role of political regimes is also examined. The empirical results show that the intermediate central banks independence level might play the role in how deeply central banks are plunged in CBDC projects. The Intermediate level is interpreted as a situation when central banks operate with enough financial independence to realize innovative projects but scope of responsibilities goes beyond a narrow focus on monetary policy. But central banks status proxy is valid in the multivariate regression. The most statistically significant driver of advances toward CBDC is financial development. Proxy for innovations is valid only in the univariate regression. In the case of multivariate regression the innovation capacity of the country is less important than financial development and central bank’s status.

Keywords:digital currency, central bank independence, financial development, political regimes, payment technologies

JEL: E58, E59, O16, O38


KOZIUK V. . Readiness to introduce digital currency: is the central bank independence important? / V. . KOZIUK // Фінанси України. - 2021. - № 3. - C. 7-22.

Article original in Ukrainian (pp. 7 - 22) DownloadDownloads :168
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