Publications
Intelligent financial system: How AI is transforming finance
Joint with I Aldasoro, L Gambacorta, A Korinek and M Stein
Journal of financial stability, Vol. 81 (2025), article 101472.
BIS working paper no. 1194, CEPR working paper no. 19181.
Big Techs in Finance
Joint with S Doerr, J Frost and L Gambacorta
Book chapter, Oxford Handbook of Banking, 4th edition, 2025.
The design and adoption of fast payments
Joint with J Aurazo, C Franco, J Frost, P K Wilkens, A Kosse and C Velasquez
Journal of Payments Strategy & Systems, Vol. 18 (2024), no. 4, pp. 366-380(15).
Mobile payments and interoperability: Insights from the academic literature
Joint with M Bianchi, M Bouvard, R Gomes and A Rhodes
Information Economics and Policy, Vol. 65 (2023), article 101068.
Working Papers
Tracing the adoption of digital technologies* (submitted)
Submitted, BIS working paper no. 1166, February 2024
Internet-based digitalisation has ushered in a wave of economic and financial development in emerging markets, but digital divides remain. Narrowing these divides requires an understanding the drivers of technology adoption. The paper develops a structural model of consumer demand and supply to understand the main drivers of adoption of an essential digital technology: smartphones. Through counterfactual simulations, the paper quantifies the role of growth in income and in income inequality, expansion of 4G network coverage, foreign entry, and improvements in device quality in expanding adoption. The paper also provides a counterfactual comparison of three pro-adoption policies: an ad-valorem tax reduction, a uniform subsidy and a targeted subsidy.
*Previously circulated as "Explaining Smartphone Adoption in India" and "Adoption of digital technologies: The case of smartphones in India"
Imitation of product characteristics in the mobile handset market
Joint with Debi Prasad Mohapatra
What is the value of an easily imitable technology? What are the economic incentives for innovation in the presence of widespread imitation? This paper studies the introduction of dual SIM handsets in the Indian mobile phone market and quantifies the value of this technology for consumers. We also quantify the impact on market outcomes of the quick imitation of this technology by competing firms. We find that the introduction of dual SIM handsets led to an increase in the consumer surplus between 3.1% to 8.9%, and an expansion in the total size of the market by 1.8% to 3.3%. While imitation reduced the innovator's profit substantially, it also made the technology much more affordable. In the absence of widespread imitation, consumer prices would have been 22% higher. Finally, we provide a lower-bound on the innovator's cost of protecting intellectual property in an emerging market. We find this lower bound to be as high as 12% of the innovator's observed profits ($ 29.5 million).
The AI supply chain (submitted)
Joint with L Gambacorta
BIS papers no. 154
The rapid advancement of artificial intelligence (AI) relies on a complex supply chain comprising five key layers: hardware, cloud infrastructure, training data, foundation models and AI applications. This paper examines the market structure of each layer and highlights the economic forces shaping them: rapid technological change, high fixed costs, economies of scale, network effects and, in some cases, strategic behaviour by dominant firms. We also highlight the expanding influence of big tech companies across the AI supply chain. We discuss the challenges for consumer choice, innovation, operational resilience, cyber security and financial stability.
Joint with J Aurazo, H Banka, G Rabadan, Nilima Ramateke and K Tanaka
BIS Working paper no. 1295, October 2025
Fast payments are at the forefront of payments digitalisation globally. By enabling immediate availability of funds on a 24/7 basis, they offer the potential to enhance efficiency, promote financial inclusion, drive innovation and foster competition. Despite their growing adoption, key questions remain regarding the design of fast payments systems (FPS), particularly concerning pricing. Open issues around pricing of fast payments exist at three levels: between the FPS owner and participants (system level), among participants themselves (participant level) and finally between the participants and their customers (end user level). This paper provides a comprehensive overview of global practices in FPS pricing at these three levels. To relate these practices with the academic literature, particularly for the person-to-merchant (P2M) payments, we use a classical two-sided market model and analyse how different pricing schemes at the end user level might influence the volume of fast payments and overall social welfare. Our expository model shows that fast payment usage may be lower than socially optimal in many cases. Moreover, when all fees are zero, fast payments are unsustainable without external subsidies or alternative revenue streams for participants.
Work in Progress
How does a demand driven floor really work?
Joint with P Asberg-Sommar, M Drehmann and D Hansson
The impact of digital finance channels on saving and investment decisions in South Africa
Joint with Judith Bohnenkamp, Arif Ismail and Jon Frost
Short Term Cost of Cash and Mobile Financial Services : Evidence from a natural experiment in India