Download or read book Essays on the Economics of Payment Card Industry written by Chi-Hui Yen and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: My dissertation consists of three chapters that address important questions in the payment card industry. Chapter 1 provides an overview of the institutional background, and introduces the problem of regressive distributional effects generated from credit card pricing. The regressive distributional effects arise when merchants pass on their costs associated with credit cards to all consumers by raising the retail prices. Since merchants typically do not differentiate prices across payment methods, these additional costs are cross-subsidized by cash and debit users. This induces a regressive transfer from low-income to high-income consumers because credit card usages tend to increase with income. Chapter 1 contributes to the literature by developing a measurement to quantify the regressive transfers made by the consumers to the merchants in a micro level. Using a unique shopping diary data conducted by Bank of Canada in 2013, I show that non-credit card users on average made a regressive transfer that is more than twice of that made by credit card users per transaction. The ratio of regressive transfers to transaction amount also decreases monotonically with income. These results suggest that how consumers choose between payment methods to make transactions have important implications on the distribution of regressive transfers, which motivates a structural estimation on consumer's payment method choices. Chapter 2 constructs a structural model of consumer adoption and usage choices, and uses the parameter estimates to simulate the counterfactual outcomes on the distributions of regressive transfers under various institutional changes. The model is built upon Huynh et al. (2021), which features a two-stage process where consumers first choose which payment bundle to adopt, then choose which payment method to use upon transaction. Heterogeneous preferences across consumer groups are estimated using a discrete-type of consumer demand model. Unlike most of the literature which ignores consumers’ choices between the issuer banks, the model considers consumers’ issuer bank choices among credit cards. Simulation results suggest that the model fits the observed data well, and generate reasonable demand elasticities of consumer usage and adoption probabilities. I conduct three policy experiments using the model estimates: a hypothetical removal of cash, a monopoly setting, and a perfect competition setting in the issuer banks. The results show that the regressive distributional effects are reduced under all three scenarios. Particularly, the monopoly setting has the strongest effects in the redistribution of regressive transfers, where it reduces the per-transaction and per-transaction value regressive transfers made by non-credit card users and low-income consumers, while increases those made by credit card users and high-income consumers. On the other hand, welfare comparisons show that perfect competition renders the highest increase in consumer surplus, while the monopoly setting and removal of cash on average hurt the consumers in terms of consumer surplus. This is the first paper to my knowledge that studies the regressive distributional effects with a structural demand model, and contributes to the literature by investigating the potential outcomes from changes in the market structure of the payment card industry. Chapter 3 builds upon the previous chapters and introduces dynamics into consumer's payment method choices. In particular, I ask how consumer awareness on merchant acceptance affects consumer's adoption and usage choices, and how information diffusion drives the adoption and usage curve over time. I extend the model developed in Chapter 2 by considering consumer awareness that varies between payment methods. Using the parameter estimates, I conduct policy experiments where I introduce a hypothetical new payment instrument in the market, assuming different consumer inform probabilities for existing instruments and the new instrument. Simulation results on post-introduction adoption and usage probabilities show that there is a large impact of consumer awareness on consumers' adoption decisions, with a bigger impact when assuming different inform probabilities for the new instrument. To understand how consumers' adoption and usage decisions change over time when consumer awareness evolves, I borrow the literature of diffusion and simulate a diffusion process of consumer awareness using the Bass Diffusion model (Bass (1969)). The simulation results show that the adoption and usage of new payment instrument exhibits an S-shaped curve after its introduction in the market, where it takes over six years to reach the convergence. Welfare analyses show that consumer surplus initially drops after the introduction, due to the lack of information, and gradually increases when consumers become more informed. This suggests that there is an impactful welfare loss associated with information failure, and it is important for the policy makers to develop measurement that ensures a quick diffusion of information when introducing a new payment method.

Download or read book The Economics of the Payment Card Industry written by David Sparks Evans and published by . This book was released on 1993 with total page 164 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Economics of Payment written by Tobias Trütsch and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis examines the impact of payment innovations such as contactless and mobile payment on individual payment behavior. It consists of three empirical studies in the field of payment economics that fill the gap in this relatively new field. Unique data sets on consumer payment choice provided by the Federal Reserve Bank of Boston are analyzed. In addition, the introductory chapter offers a comprehensive overview of the various strands of research on the factors driving consumer payment behavior. It also extends literature by providing a theoretical model of individual payment behavior that draws together the reviewed literature. In the first study, the effect of contactless payment on the transaction ratio for different transaction types at the stationary point-of-sale (POS) is estimated. The specific devices that are investigated are debit and credit cards, to which the feature is embedded. Using propensity score matching to control for selection, the estimation shows that the contactless feature yields a statistically significant increase in the transaction ratio at the POS for both payment methods. The average treatment effect on the treated for credit and debit cards is roughly 8% and 10%, respectively. These findings indicate that the private industry can benefit from the innovation with respect to additional revenue streams. The second study explores the impact of contactless payment on cash usage in terms of value spending and transaction frequency at the POS. The specific devices that are investigated are debit and credit cards, to which the feature is embedded. Employing cross-sectional estimation methods, the estimation shows that contactless payment leads to a statistically significant reduction in average cash usage at the POS in terms of value and volume. The negative effect of contactless credit and debit cards on cash volume is 5% and 6%, respectively. The negative impact of contactless credit cards on cas.

Download or read book Essays on Economics and Economists written by R. H. Coase and published by University of Chicago Press. This book was released on 1994 with total page 234 pages. Available in PDF, EPUB and Kindle. Book excerpt: How do economists tackle the problems of the economic system and give advice on public policy? Nobel laureate R.H. Coase reflects on some of the most fundamental concerns of economists over the past two centuries. In 15 essays, Coase explore the history and philosophy of economics and evaluates the contributions of a number of outstanding figures.

Download or read book Essays in Positive Economics written by Milton Friedman and published by University of Chicago Press. This book was released on 1953 with total page 336 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper is concerned primarily with certain methodological problems that arise in constructing the "distinct positive science" that John Neville Keynes called for, in particular, the problem how to decide whether a suggested hypothesis or theory should be tentatively accepted as part of the "body of systematized knowledge concerning what is."

Download or read book Interchange Fee Economics written by Jakub Górka and published by Palgrave Macmillan. This book was released on 2019-12-24 with total page 181 pages. Available in PDF, EPUB and Kindle. Book excerpt: Interchange fees have been the focal point for debate in the card industry, among competition authorities and policy makers, as well as in the economic literature on two-sided markets and on the regulation of market failures. This book offers insight into the economics of interchange fees. First, it explains the nature of two-sided markets/platforms/networks and elaborates on four-party schemes and on the rationale behind interchange fees according to Baxter’s model and its later refinements. It also includes the debate about the optimum level of interchange fees and its determination (“tourist test”), and presents the original framework for assessing the impact of interchange fee regulatory reductions for the market participants: consumers, merchants, acquirers, issuers, and card organisations. The framework addresses three areas of concern in reference to the transmission channels of interchange fee reductions (pass-through) and the card scheme domain (triangle: payment organisation, issuer, acquirer). The book discusses the effects of regulatory interchange fee reductions in Australia, USA, Spain, and, most specifically, Poland. It will be of interest to policy makers, card and payments industry practitioners, academics, and students.

Download or read book Analyzing the Economics of Financial Market Infrastructures written by Diehl, Martin and published by IGI Global. This book was released on 2015-08-17 with total page 439 pages. Available in PDF, EPUB and Kindle. Book excerpt: The prosperity and stability of any economic structure is reliant upon a foundation of secure systems that regulate the movement of money across the globe. These structures have become an integral part of contemporary society by reducing monetary risk and increasing financial security. Analyzing the Economics of Financial Market Infrastructures is a pivotal reference source for the latest scholarly research on the current developments in financial systems and how these processes are evolving due to new regulations and technical advances. Featuring extensive coverage on a range of relevant topics on payment systems, central securities depositories, central counterparties, and trade repositories, this book is an essential reference source for professionals in the financial sector, analysts, IT professionals, and academicians concerned with emerging research on financial markets. This book features timely, research-based chapters on a variety of crucial topics including, but not limited to, payment timing, multi-layer networks, transaction simulations, payment system analysis, and regulation of financial marketplaces.

Download or read book Essays in Payment Economics written by Thomas Nellen and published by . This book was released on 2010 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Asset Securitization Bank Production Costs and the Credit Card Market written by Hyun Jin Lee and published by . This book was released on 2003 with total page 286 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Immigration Economics written by George J. Borjas and published by Harvard University Press. This book was released on 2014-06-09 with total page 295 pages. Available in PDF, EPUB and Kindle. Book excerpt: Millions of people—nearly 3 percent of the world’s population—no longer live in the country where they were born. Every day, migrants enter not only the United States but also developed countries without much of a history of immigration. Some of these nations have switched in a short span of time from being the source of immigrants to being a destination for them. International migration is today a central subject of research in modern labor economics, which seeks to put into perspective and explain this historic demographic transformation. Immigration Economics synthesizes the theories, models, and econometric methods used to identify the causes and consequences of international labor flows. Economist George Borjas lays out with clarity and rigor a full spectrum of topics, including migrant worker selection and assimilation, the impact of immigration on labor markets and worker wages, and the economic benefits and losses that result from immigration. Two important themes emerge: First, immigration has distributional consequences: some people gain, but some people lose. Second, immigrants are rational economic agents who attempt to do the best they can with the resources they have, and the same holds true for native workers of the countries that receive migrants. This straightforward behavioral proposition, Borjas argues, has crucial implications for how economists and policymakers should frame contemporary debates over immigration.

Download or read book An Introduction to the Economics of Payment Card Networks written by Robert M. Hunt and published by . This book was released on 2019 with total page 17 pages. Available in PDF, EPUB and Kindle. Book excerpt: Open payment card networks typically coordinate the activities of thousands of financial institutions that issue cards, millions of retail locations that accept them, and several hundred million consumers that use them. This coordination can include the collective setting of certain prices and other controversial network rules. Such practices have recently come under the scrutiny of antitrust authorities in the U.S. and abroad. This article provides a brief overview of the economics of the payment card industry, explaining some of the differences from the textbook model of competitive markets. Such differences are important factors for the antitrust analysis of payment card networks.

Download or read book Essays in Transportation Economics and Policy written by Jose A. Gomez-Ibanez and published by Brookings Institution Press. This book was released on 2011-01-01 with total page 592 pages. Available in PDF, EPUB and Kindle. Book excerpt: This comprehensive survey of transportation economic policy pays homage to a classic work, Techniques of Transportation Planning, by renowned transportation scholar John R. Meyer. With contributions from leading economists in the field, it includes added emphasis on policy developments and analysis. The book covers the basic analytic methods used in transportation economics and policy analysis; focuses on the automobile, as both the mainstay of American transportation and the source of some of its most serious difficulties; covers key issues of urban public transportation; and analyzes the impact of regulation and deregulation on the U.S. airline, railroad, and trucking industries. In addition to the editors, the contributors are Alan A. Altshuler, Harvard University; Ronald R. Braeutigam, Northwestern University; Robert E. Gallamore, Union Pacific Railroad; Arnold M. Howitt, Harvard University; Gregory K. Ingram, The Wold Bank; John F. Kain, University of Texas at Dallas; Charles Lave, University of California, Irvine; Lester Lave, Carnegie Mellon University; Robert A. Leone, Boston University; Zhi Liu, The World Bank; Herbert Mohring, University of Minnesota; Steven A. Morrison, Northeastern University; Katherine M. O'Regan, Yale University; Don Pickrell, U.S. Department of Transportation; John M. Quigley, University of California, Berkeley; Ian Savage, Northwestern University; and Kenneth A. Small, University of California Irvine.

Download or read book Economics as a Process written by Richard Langlois and published by CUP Archive. This book was released on 1986 with total page 292 pages. Available in PDF, EPUB and Kindle. Book excerpt: Consists of original and rev. versions of papers presented at a conference at Airlie House in Virginia, Mar. 1983. Includes bibliographies and index.

Download or read book Essays on the Great Depression written by Ben S. Bernanke and published by Princeton University Press. This book was released on 2009-01-10 with total page 321 pages. Available in PDF, EPUB and Kindle. Book excerpt: From the Nobel Prize–winning economist and former chair of the U.S. Federal Reserve, a landmark book that provides vital lessons for understanding financial crises and their sometimes-catastrophic economic effects As chair of the U.S. Federal Reserve during the Global Financial Crisis, Ben Bernanke helped avert a greater financial disaster than the Great Depression. And he did so by drawing directly on what he had learned from years of studying the causes of the economic catastrophe of the 1930s—work for which he was later awarded the Nobel Prize. This influential work is collected in Essays on the Great Depression, an important account of the origins of the Depression and the economic lessons it teaches.

Download or read book Paying with Plastic second edition written by David S. Evans and published by MIT Press. This book was released on 2004-12-17 with total page 388 pages. Available in PDF, EPUB and Kindle. Book excerpt: The definitive account of the trillion-dollar payment card industry. The payment card business has evolved from its inception in the 1950s as a way to handle payment for expense-account lunches (the Diners Club card) into today's complex, sprawling industry that drives trillions of dollars in transaction volume each year. Paying with Plastic is the definitive source on an industry that has revolutionized the way we borrow and spend. More than a history book, Paying with Plastic delivers an entertaining discussion of the impact of an industry that epitomizes the notion of two-sided markets: those in which two or more customer groups receive value only if all sides are actively engaged. New to this second edition, the two-sided market discussion provides useful insight into the implications of these market dynamics for cardholder rewards, merchant interchange fees, and card acceptance. The authors, both of whom have researched the industry for more than 25 years, also examine the implications of the recent antitrust cases on the industry as well as other business and technological changes—including the massive consolidation brought about by bank mergers, the rise of the debit card, and the emergence of e-commerce—that could alter the payment card industry dramatically in the years to come.

Download or read book The Meaning of the Market Process written by Israel M Kirzner and published by Routledge. This book was released on 2002-09-11 with total page 254 pages. Available in PDF, EPUB and Kindle. Book excerpt: Israel Kirzner is the foremost proponent of the modern Austrian theory of the market process. This book offers substantive insights in support of this theory and a new historical interpretation of how the ideas of modern Austrians emerged.

Download or read book Contours of the World Economy 1 2030 AD written by Angus Maddison and published by Oxford University Press. This book was released on 2007-09-20 with total page 433 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book seeks to identify the forces which explain how and why some parts of the world have grown rich and others have lagged behind. Encompassing 2000 years of history, part 1 begins with the Roman Empire and explores the key factors that have influenced economic development in Africa,Asia, the Americas and Europe. Part 2 covers the development of macroeconomic tools of analysis from the 17th century to the present. Part 3 looks to the future and considers what the shape of the world economy might be in 2030. Combining both the close quantitative analysis for which ProfessorMaddison is famous with a more qualitative approach that takes into account the complexity of the forces at work, this book provides students and all interested readers with a totally fascinating overview of world economic history. Professor Maddison has the unique ability to synthesise vast amountsof information into a clear narrative flow that entertains as well as informs, making this text an invaluable resource for all students and scholars, and anyone interested in trying to understand why some parts of the World are so much richer than others.