Incentives, communication and payment instruments

Article Abstract:

The communication and commitment characteristics of alternative payment instruments were studied in an environment in which the trade-off between credit risk and the resource cost of guarantees determined means of payment. The study showed that checks could perform well when compared with other instruments in spite of their limited commitment problems but instruments like bank drafts were analogous to gross settlement, as they eliminated credit risk but imposed resource costs on participants.

Forecasts, trends, outlooks, Forecasts and trends, Market trend/market analysis, Credit market, Credit markets

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Clearing, settlement and monetary policy

Article Abstract:

A general equilibrium model of the clearing and settlement of private payment instruments is developed to understand the use of central bank deposit liabilities. Spatial separation, heterogeneous preference shocks and limited communication support private credit as a mode of payment. The model shows that the policy regime has a significant influence on the incentive to develop private multilateral arrangements to clear and settle payments.

International Affairs, Economic Intelligence, Economic aspects, Central banks, Economic indicators, International communication

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Payment economics: studying the mechanics of exchange

Article Abstract:

The distinct and coherent field of inquiry called 'payment economics' was discussed. The emerging field of payment economics drew on techniques and insights from monetary and banking theory as well as on tools from industrial organization that would promote a cohesive, integrated approach to the analysis of policy issues related to the institutions that facilitate exchan

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