Case study on demonetization in india

There were two explicit reasons given for the demonetisation. One was that it was an attack on terrorist funding, and the second was that it was an attack on the black economy. I don’t know enough about terrorist financing in India to comment on the efficacy of the move, but it seemed to target counterfeiting operations in Pakistan.

Suddenly all mainstream media (Business news and TV shows) started talking about Bitcoin. The price for 1 BTC kept on rising from 50,000 INR and reached almost 70,000 INR in 3 weeks (40% high). Early adopters of Bitcoin in West were the libertarians as discussed earlier.

I have previously posted about the famous case study of the Irish bank strikes that demonetized the Emerald Isle in the 1960s and 1970s. Subsequent economic analysis showed that the absence of money had surprisingly little impact on the economy! People just began to write cheques or IOUs and these debt instruments began to circulate.

The study finds that demonetization exersice has been a failure in major parts of the world. The researcher has tried to analyse a few reasons behind these failures and offered a few suggestions for demonetization to be successful and to attack black economy.