Xiaoying Li
Ph.D. Candidate in Finance
Kelley School of Business
Indiana University Bloomington
Email:li527@indiana.edu
Welcome!
Welcome!
I am a PhD Candidate in Finance at the Kelley School of Business at Indiana University. I will be on the academic job market and available for interviews in Fall 2024/Spring 2025.
I am a PhD Candidate in Finance at the Kelley School of Business at Indiana University. I will be on the academic job market and available for interviews in Fall 2024/Spring 2025.
My research interests focus on bank intermediation. My job market paper studies how the introduction of central bank digital currency (CBDC) affects bank deposit market competition and funding stability.
My research interests focus on bank intermediation. My job market paper studies how the introduction of central bank digital currency (CBDC) affects bank deposit market competition and funding stability.
Here is my CV
Link to my Papers
Job Market Paper
Central Bank Digital Currency: Effects on Deposit Competition and Bank Funding Stability
Central Bank Digital Currency: Effects on Deposit Competition and Bank Funding Stability
A retail central bank digital currency (CBDC) increases the competitiveness of small banks but may also raise their bank-run risks. This paper studies this trade-off by exploiting the staggered entry of digital Chinese Yuan (the e-CNY) across citis, which imposed variation in the effects of the liquidity and bank-run risk shocks across banks. While enhanced competition in liquidity provision induces small banks to decrease short-term deposit rates relative to large banks, higher bank-run risks cause higher rates of long-term maturity deposits of small versus large banks. Further, funding composition of small banks tilts toward longer maturity deposits, suggesting better preparation for destabilizing "bank walks" with CBDC.
A retail central bank digital currency (CBDC) increases the competitiveness of small banks but may also raise their bank-run risks. This paper studies this trade-off by exploiting the staggered entry of digital Chinese Yuan (the e-CNY) across citis, which imposed variation in the effects of the liquidity and bank-run risk shocks across banks. While enhanced competition in liquidity provision induces small banks to decrease short-term deposit rates relative to large banks, higher bank-run risks cause higher rates of long-term maturity deposits of small versus large banks. Further, funding composition of small banks tilts toward longer maturity deposits, suggesting better preparation for destabilizing "bank walks" with CBDC.