E-Barter vs. Fiat Money: Will Central
Banks Survive?
F.H. Capie, Dimitrios P. Tsomocos,
Geoffrey E. Wood
Abstract
New
technology in computing has led some to suggest that the ability to settle
transactions electronically will develop to such an extent that money
disappears from use. Two versions of this belief exist. One
maintains that there will be “e-money”, issued conceivably by many
organisations, and that this will replace central bank money. The
other suggests a still further development – that the very concept of a
medium of exchange may become redundant, as assets or goods can be
exchanged directly for other assets or goods through use of computing.
In this paper we argue that the information-economising properties which
allowed money to develop will also allow it to survive, despite actual and
hypothesised technical progress.
