Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/264770 
Authors: 
Year of Publication: 
2012
Series/Report no.: 
Working Paper No. 178
Publisher: 
Oesterreichische Nationalbank (OeNB), Vienna
Abstract: 
The paper analyzes why households in transition economies prefer to hold sizeable shares of their assets in cash at home rather than in banks. Using survey data from ten Central, Eastern and Southeastern European countries, I document the relevance of this behavior and show that cash preferences cannot be fully explained by whether people are banked or unbanked. The analysis reveals that a lack of trust in banks, memories of past banking crises and weak tax enforcement are important factors. Moreover, cash preferences are stronger in dollarized economies where a "safe" foreign currency serves as a store of value.
Subjects: 
Cash demand
cash hoarding
household finance
trust in banks
social capital
dollarization
JEL: 
E41
O16
G11
D12
P34
Document Type: 
Working Paper

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