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Structure of Monetary Assets in Transition Economies: Financial Innovation and Structural Transformation

  • Gérard Duchêne

    (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12, CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Ramona Jimborean

    (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12)

  • Boris Najman

    ()

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, GRATICE - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12)

Using a panel data set we investigate the specificities of the structure of monetary assets in transition economies. This analysis reveals the main factors standing behind the structure of deposits held with banks (demand or time deposits), as well as the determinants of the trade-off between cash and demand deposits in Central and Eastern European Countries and in Former Soviet Union countries. We show that the strong preference for cash, which appears in transition countries, is related to the extent of the informal sector, to the low efficiency of the banking sector as well as to the massive currency substitutions. The relatively high share of time deposits compared to demand deposits is due to the inefficiency of the banking system and to the low level of development of alternative financial markets.

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Paper provided by HAL in its series Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) with number hal-00270544.

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Date of creation: 11 May 2006
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Publication status: Published in Développements récents en Economie Financière, aspects microéconomiques et macroéconomiques., May 2006, Strasbourg, France
Handle: RePEc:hal:cesptp:hal-00270544
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