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What determines the value and volume of noncash transactions? Evidence from a panel of European and North American countries

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Alessandra Guariglia
Yiing Jia Loke

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Abstract

Using data from a panel of 15 countries over the period 1990-1998, the determinants of the use of non cash payment instruments are analysed. The estimation results highlight the importance of distinguishing between the determinants of the value and volume of noncash transactions. It is found in fact that the volume of these transactions is generally affected by changes in the determinants more strongly than their value, and that variables such as the interest rate have a different impact on the volume and the value of the transactions. The findings also suggest that past habits play a dominant role in the intensity of use of noncash payment instruments.

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Publisher Info
Article provided by Taylor and Francis Journals in its journal Applied Economics.

Volume (Year): 36 (2004)
Issue (Month): 4 (March)
Pages: 291-303
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Handle: RePEc:taf:applec:v:36:y:2004:i:4:p:291-303

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  1. Mathias Drehmann & Charles Goodhart & Malte Krueger, 2002. "The challenges facing currency usage: will the traditional transaction medium be able to resist competition from the new technologies?," Economic Policy, CEPR, CES, MSH, vol. 17(34), pages 193-228, 04. [Downloadable!] (restricted)
  2. James J. McAndrews, 1997. "Network issues and payment systems," Business Review, Federal Reserve Bank of Philadelphia, issue Nov, pages 15-25. [Downloadable!]
  3. Jussi Snellman & Jukka Vesala & David Humphrey, 2001. "Substitution of Noncash Payment Instruments for Cash in Europe," Journal of Financial Services Research, Springer, vol. 19(2), pages 131-145, April. [Downloadable!] (restricted)
  4. David Humphrey & Lawrence Pulley & Jukka Vesala, 2000. "The Check's in the Mail: Why the United States Lags in the Adoption of Cost-Saving Electronic Payments," Journal of Financial Services Research, Springer, vol. 17(1), pages 17-39, February. [Downloadable!] (restricted)
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