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Abstract

This article discusses the impact of central bank digital currency (CBDC) from the perspective of monetary and fiscal policy. We mainly discuss how retail CBDC can improve traditional policy performance. We argue that A CBDC helps existing monetary policies to break through the zero lower bound, shorten the policy time lag, realize selective policy interventions, and make possible the price level target policy system. Similarly, the combination of CBDC and smart contracts can directly affect the performance of the fiscal policy. Compared with the convenience and impact of CDBC as a medium of exchange, its impact as a policy tool is more profound. The current monetary policy is facing a zero lower bound. The fiscal policy is facing a huge sovereign debt crisis and the impact of other private digital currencies on fiat money, which makes the importance of CBDC as a new policy tool more prominent. However, the research on CBDC as a policy tool has many fundamental questions that remain to be answered. This paper contextualizes CBDC with global challenges in policies and new technology advances, and the authors rethink CBDC from a policy perspective, which may provide many new thoughts and have implications for the rise of global CBDC.

DOI

http://dx.doi.org/10.19873/j.cnki.2096-0212.2023.01.001

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