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Factors behind high cash usage in Hungary


  • Anikó Bódi-Schubert

    () (Magyar Nemzeti Bank (central bank of Hungary))


This article summarises the findings of qualitative, in-depth interviews which aimed to explore the motivating factors behind domestic cash usage that generate the significantly higher cash volumes in Hungary than would ’normally’ be justified. In the opinion of the experts interviewed, cash usage may be facilitated by the intensive cash need of the hidden economy, the traditional cash-oriented behaviour of the public administration and a lack of trust in business-to-business transactions. This analysis primarily intends to capture certain trends, which may have temporarily changed in the wake of the economic crisis, but nevertheless span a number of years and the specific phenomena of which may be regarded as generally valid over the long term, apart from certain periodic effects.

Suggested Citation

  • Anikó Bódi-Schubert, 2010. "Factors behind high cash usage in Hungary," MNB Bulletin (discontinued), Magyar Nemzeti Bank (Central Bank of Hungary), vol. 5(1), pages 20-28, March.
  • Handle: RePEc:mnb:bullet:v:5:y:2010:i:1:p:20-28

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    References listed on IDEAS

    1. Robert J. Barro, 2013. "Inflation and Economic Growth," Annals of Economics and Finance, Society for AEF, vol. 14(1), pages 121-144, May.
    2. William T. Dickens & Lorenz Goette & Erica L. Groshen & Steinar Holden & Julian Messina & Mark E. Schweitzer & Jarkko Turunen & Melanie E. Ward, 2007. "How Wages Change: Micro Evidence from the International Wage Flexibility Project," Journal of Economic Perspectives, American Economic Association, vol. 21(2), pages 195-214, Spring.
    3. Burdekin, Richard C.K. & Denzau, Arthur T. & Keil, Manfred W. & Sitthiyot, Thitithep & Willett, Thomas D., 2004. "When does inflation hurt economic growth? Different nonlinearities for different economies," Journal of Macroeconomics, Elsevier, vol. 26(3), pages 519-532, September.
    4. Amato, Jeffery D. & Gerlach, Stefan, 2002. "Inflation targeting in emerging market and transition economies: Lessons after a decade," European Economic Review, Elsevier, vol. 46(4-5), pages 781-790, May.
    5. Ball, Laurence & Mankiw, N Gregory, 1994. "Asymmetric Price Adjustment and Economic Fluctuations," Economic Journal, Royal Economic Society, vol. 104(423), pages 247-261, March.
    6. George A. Akerlof & William R. Dickens & George L. Perry, 1996. "The Macroeconomics of Low Inflation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 27(1), pages 1-76.
    7. Anne-Marie Brook & Özer Karagedikli & Dean Scrimgeour, 2002. "An optimal inflation target for New Zealand: lessons from the literature," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 65, September.
    8. Bruno, Michael & Easterly, William, 1998. "Inflation crises and long-run growth," Journal of Monetary Economics, Elsevier, vol. 41(1), pages 3-26, February.
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    Cited by:

    1. Szabolcs Szikszai & Tamás Badics & Csilla Raffai & Zsolt Stenger & András Tóthmihály, 2013. "Studies in Financial Systems No 8 Hungary," FESSUD studies fstudy08, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.

    More about this item


    cash usage; hidden economy; tax avoidance; petty cash.;

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • N20 - Economic History - - Financial Markets and Institutions - - - General, International, or Comparative
    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General


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