For a Political Economy of Central Bank Digital Currency

This article proposes to consider central bank digital currency (CBDC) from a political economy perspective. In this respect, incentives at play suggest that CBDC would be welcomed by some agents, in particular policymakers, and rather disliked by others, especially banks. Furthermore, it is political economy considerations, rather than analytical ones, that could play an important role in the launch of retail CBDC (rCBDC). Finally, rCBDC could be given a clear advantage in terms of status and transaction fees, programmable rCBDC would open prospects for mass surveillance in undemocratic countries and, from an international point of view, CBDCs would seem well-suited for weaponisation.