IDEAS home Printed from https://ideas.repec.org/a/fip/fedcer/y1995iqiiip14-29.html
   My bibliography  Save this article

Scale economies and technological change in Federal Reserve ACH payment processing

Author

Abstract

An analysis of the contribution of scale economies, technological change, and falling input prices to the absolute reduction in the real processing costs of an ACH transfer over the 1979-94 period.

Suggested Citation

  • Paul W. Bauer & Diana Hancock, 1995. "Scale economies and technological change in Federal Reserve ACH payment processing," Economic Review, Federal Reserve Bank of Cleveland, issue Q III, pages 14-29.
    • Handle: RePEc:fip:fedcer:y:1995:i:qiii:p:14-29
    as

    Download full text from publisher

    File URL: http://www.clevelandfed.org/Research/Review/1995/95-q3-bauer.pdf
    Download Restriction: no
    File URL: https://fraser.stlouisfed.org/scribd/?toc_id=328957&filepath=/docs/publications/frbclevreview/rev_frbclev_1995q3.pdf&start_page=15#scribd-open
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jack H. Beebe & Gary C. Zimmerman, 1982. "Fed pricing," FRBSF Economic Letter, Federal Reserve Bank of San Francisco, issue mar12.
    2. Scott E. Knudson & Jack K. Walton & Florence M. Young, 1994. "Business-to-business payments and the role of financial electronic data interchange," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Apr, pages 269-278.
    3. Hirshleifer,Jack & Glazer,Amihai & Hirshleifer,David, 2005. "Price Theory and Applications," Cambridge Books, Cambridge University Press, number 9780521523424.
    4. Roberts, Kevin W S, 1979. "Welfare Considerations of Nonlinear Pricing," Economic Journal, Royal Economic Society, vol. 89(353), pages 66-83, March.
    5. Walter Y. Oi, 1971. "A Disneyland Dilemma: Two-Part Tariffs for a Mickey Mouse Monopoly," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 85(1), pages 77-96.
    6. David B. Humphrey, 1982. "Costs, scale economies, competition, and product mix in the U.S. payments mechanism," Staff Studies 115, Board of Governors of the Federal Reserve System (U.S.).
    7. Gary C. Zimmerman, 1981. "The pricing of Federal Reserve services under MCA," Economic Review, Federal Reserve Bank of San Francisco, issue Win, pages 22-40.
    8. Paul W. Bauer, 1993. "Efficiency and technical progress in check processing," Economic Review, Federal Reserve Bank of Cleveland, vol. 29(Q III), pages 24-38.
    9. Baumol, William J & Bradford, David F, 1970. "Optimal Departures from Marginal Cost Pricing," American Economic Review, American Economic Association, vol. 60(3), pages 265-283, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Khiaonarong, Tanai, 2003. "Payment systems efficiency, policy approaches, and the role of the central bank," Research Discussion Papers 1/2003, Bank of Finland.
    2. Joanna Stavins, 1997. "A comparison of social costs and benefits of paper check presentment and ECP with truncation," New England Economic Review, Federal Reserve Bank of Boston, issue Jul, pages 27-44.
    3. Khiaonarong, Tanai, 2003. "Payment systems efficiency, policy approaches, and the role of the central bank," Bank of Finland Research Discussion Papers 1/2003, Bank of Finland.
    4. Gilbert, R. Alton & Wheelock, David C. & Wilson, Paul W., 2004. "New evidence on the Fed's productivity in providing payments services," Journal of Banking & Finance, Elsevier, vol. 28(9), pages 2175-2190, September.
    5. Joanna Stavins, 2002. "Effect of consumer characteristics on the use of payment instruments," New England Economic Review, Federal Reserve Bank of Boston, issue Q 3, pages 19-31.
    6. Hromcová, Jana, 2008. "Learning-or-doing in a cash-in-advance economy with costly credit," Journal of Economic Dynamics and Control, Elsevier, vol. 32(9), pages 2826-2853, September.
    7. Adams, Robert M & Bauer, Paul W & Sickles, Robin C, 2004. "Scale Economies, Scope Economies, and Technical Change in Federal Reserve Payment Processing," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 36(5), pages 943-958, October.
    8. W. Scott Frame & Lawrence J. White, 2009. "Technological change, financial innovation, and diffusion in banking," FRB Atlanta Working Paper 2009-10, Federal Reserve Bank of Atlanta.
    9. Guerino Ardizzi, 2004. "Cost Efficiency in the Retail Payment Networks: First Evidence from the Italian Credit Card System," Rivista di Politica Economica, SIPI Spa, vol. 94(5), pages 51-82, September.
    10. Berger, Allen N. & Demsetz, Rebecca S. & Strahan, Philip E., 1999. "The consolidation of the financial services industry: Causes, consequences, and implications for the future," Journal of Banking & Finance, Elsevier, vol. 23(2-4), pages 135-194, February.
    11. Joanna Stavins & Paul Bauer, 1999. "The Effect of Pricing on Demand and Revenue in Federal Reserve ACH Payment Processing," Journal of Financial Services Research, Springer;Western Finance Association, vol. 16(1), pages 27-45, September.
    12. Bruno Amable & Jean-Bernard Chatelain, 1999. "Infrastructures financières et croissance économique," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00432131, HAL.
    13. Paul D. Mueller, 2016. "Public and Private Institutions in the Federal Reserve," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 31(Fall 2016), pages 49-68.
    14. Hancock, Diana & Humphrey, David B., 1997. "Payment transactions, instruments, and systems: A survey," Journal of Banking & Finance, Elsevier, vol. 21(11-12), pages 1573-1624, December.
    15. repec:zbw:bofrdp:2003_001 is not listed on IDEAS
    16. Hasan, Iftekhar & Malkamaki, Markku, 2001. "Are expansions cost effective for stock exchanges? A global perspective," Journal of Banking & Finance, Elsevier, vol. 25(12), pages 2339-2366, December.
    17. Robert M. Adams & Paul W. Bauer & Robin C. Sickles, 2002. "Scope and scale economies in Federal Reserve payment processing," Working Papers (Old Series) 0213, Federal Reserve Bank of Cleveland.
    18. W. Scott Frame & Larry D. Wall & Lawrence J. White, 2018. "Technological Change and Financial Innovation in Banking: Some Implications for Fintech," FRB Atlanta Working Paper 2018-11, Federal Reserve Bank of Atlanta.
    19. Tanai Khiaonarong, 2004. "Payment systems efficiency, policy approaches, and the role of the central bank," Finance 0405004, University Library of Munich, Germany.
    20. Kirstin E. Wells, 1996. "Are checks overused?," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 20(Fall), pages 2-12.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. van Egteren, Henry, 1996. "Regulating an externality-generating public utility: A multi-dimensional screening approach," European Economic Review, Elsevier, vol. 40(9), pages 1773-1797, December.
    2. Paul W. Bauer & Gary D. Ferrier, 1996. "Scale economies, cost efficiencies, and technological change in Federal Reserve payments," Financial Services working paper 96-01, Federal Reserve Bank of Cleveland.
    3. Andersson, Tommy, 2004. "Essays on Nonlinear Pricing and Welfare," MPRA Paper 59446, University Library of Munich, Germany.
    4. Carmona, Miguel, 2010. "The regulatory function in public-private partnerships for the provision of transport infrastructure," Research in Transportation Economics, Elsevier, vol. 30(1), pages 110-125.
    5. Mark Armstrong & John Vickers, 2018. "Multiproduct Pricing Made Simple," Journal of Political Economy, University of Chicago Press, vol. 126(4), pages 1444-1471.
    6. Ethier, Robert G. & Mount, Timothy D., 1996. "Competitive Electricity Markets In New York State: Empirical Impacts Of Industry Restructuring," Working Papers 127907, Cornell University, Department of Applied Economics and Management.
    7. Joanna Stavins & Paul Bauer, 1999. "The Effect of Pricing on Demand and Revenue in Federal Reserve ACH Payment Processing," Journal of Financial Services Research, Springer;Western Finance Association, vol. 16(1), pages 27-45, September.
    8. María Angeles García Valiñas, 2004. "Eficiencia y equidad en el diseño de precios óptimos para bienes y servicios públicos," Hacienda Pública Española / Review of Public Economics, IEF, vol. 168(1), pages 95-119, march.
    9. Severin Borenstein & Lucas W. Davis, 2012. "The Equity and Efficiency of Two-Part Tariffs in U.S. Natural Gas Markets," Journal of Law and Economics, University of Chicago Press, vol. 55(1), pages 75-128.
    10. José Holguín-Veras & Sergio Jara-Díaz, 2010. "Optimal Two-Part Pricing and Capacity Allocation with Multiple User Classes and Elastic Arrivals at Constrained Transportation Facilities," Networks and Spatial Economics, Springer, vol. 10(4), pages 427-454, December.
    11. Hancock, Diana & Humphrey, David B., 1997. "Payment transactions, instruments, and systems: A survey," Journal of Banking & Finance, Elsevier, vol. 21(11-12), pages 1573-1624, December.
    12. Murray Fulton & James Vercammen, 2014. "Optimal NGO Financing of a Resource Management Certification Scheme," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 58(4), pages 605-626, August.
    13. Hancock, Diana & Humphrey, David B. & Wilcox, James A., 1999. "Cost reductions in electronic payments: The roles of consolidation, economies of scale, and technical change," Journal of Banking & Finance, Elsevier, vol. 23(2-4), pages 391-421, February.
    14. Evens Salies & Catherine Waddams, 2003. "Pricing structure in the deregulated UK electricity market," SciencePo Working papers Main hal-03592457, HAL.
    15. Schmalensee, Richard, 1981. "Output and Welfare Implications of Monopolistic Third-Degree Price Discrimination," American Economic Review, American Economic Association, vol. 71(1), pages 242-247, March.
    16. Simon P. Anderson & Régis Renault, 2011. "Price Discrimination," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 22, Edward Elgar Publishing.
    17. Atabek Atayev, 2021. "Nonlinear Prices, Homogeneous Goods, Search," Papers 2109.15198, arXiv.org.
    18. repec:ebl:ecbull:v:12:y:2005:i:8:p:1-4 is not listed on IDEAS
    19. Tarek Abdallah, 2019. "On the Benefit (Or Cost) of Large‐Scale Bundling," Production and Operations Management, Production and Operations Management Society, vol. 28(4), pages 955-969, April.
    20. Alessandro Avenali & Tiziana D’Alfonso & Pierfrancesco Reverberi, 2022. "Optimal pricing and investment for resources with alternative uses and capacity limits," Journal of Regulatory Economics, Springer, vol. 61(3), pages 222-229, June.
    21. Thijs ten Raa, 2009. "Monopoly, Pareto and Ramsey Mark-ups," Journal of Industry, Competition and Trade, Springer, vol. 9(1), pages 57-63, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedcer:y:1995:i:qiii:p:14-29. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: 4D Library (email available below). General contact details of provider: https://edirc.repec.org/data/frbclus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.