Results of demonetization 2016

Abstract

The government of India demonetized the 500 and 1,000 Rupee notes on November 8, 2016 with the purpose of identifying the size of the formal economy and also for reducing the size of the parallel economy. In this sense, the article aims to analyze the results of this demonetization. It is concluded that the measure generated shortages of cash, changes in the consumer preferences, a greater use of electronic transfers, increased inflation, decrease in the growth of productive activity, and a new distribution of the monetary cone.