The Impact of Banking and Fringe Banking Regulation on the Number of Unbanked Americans
AbstractThirty-five to 45 percent of low-income American households do not possess a bank account. This statistic coupled with claims of price gouging by check cashers has prompted government intervention. I find that state legislation requiring banks to offer low-cost accounts slightly decreases the number of low-income minority unbanked households, but only with a substantial lag. Caps on check-cashing fees also lead to a small, but more immediate, reduction in the number of unbanked among this population. Because price caps may lead to a reduction in supply, welfare effects are indeterminate.
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Bibliographic InfoArticle provided by University of Wisconsin Press in its journal Journal of Human Resources.
Volume (Year): 41 (2006)
Issue (Month): 1 ()
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Web page: http://jhr.uwpress.org/
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