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How people pay in Uruguay: the role of transaction characteristics

Author

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  • Rodrigo Lluberas

    (Banco Central del Uruguay)

Abstract

A number of changes in the payment system have taken place over the last couple of years that are likely to change dramatically how households pay for their purchases in Uruguay. We use a household expenditure survey with detailed data on household demographics and transaction characteristics to estimate a multiple choice model of household payment instrument use. We find that not including transaction characteristics results in bias estimates of household characteristics effects. Indeed, we find that once we include transaction characteristics, income and age play a minor role in explaining household payment instrument choice in Uruguay

Suggested Citation

  • Rodrigo Lluberas, 2014. "How people pay in Uruguay: the role of transaction characteristics," Documentos de trabajo 2014005, Banco Central del Uruguay.
    • Handle: RePEc:bku:doctra:2014005
    as

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    File URL: https://www.bcu.gub.uy/Estadisticas-e-Indicadores/Documentos%20de%20Trabajo/5.2014.pdf
    File Function: First version, 2014
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    References listed on IDEAS

    as
    1. Klee, Elizabeth, 2008. "How people pay: Evidence from grocery store data," Journal of Monetary Economics, Elsevier, vol. 55(3), pages 526-541, April.
    2. Elizabeth C. Klee, 2006. "Families' use of payment instruments during a decade of change in the U.S. payment system," Finance and Economics Discussion Series 2006-01, Board of Governors of the Federal Reserve System (U.S.).
    3. Jean-Charles Rochet & Jean Tirole, 2003. "Platform Competition in Two-Sided Markets," Journal of the European Economic Association, MIT Press, vol. 1(4), pages 990-1029, June.
    4. Cohen, Michael & Rysman, Marc, 2012. "Payment Choice with Consumer Panel Data," Working Paper series 148348, University of Connecticut, Charles J. Zwick Center for Food and Resource Policy.
    5. Borzekowski, Ron & Kiser, Elizabeth K., 2008. "The choice at the checkout: Quantifying demand across payment instruments," International Journal of Industrial Organization, Elsevier, vol. 26(4), pages 889-902, July.
    6. Rodrigo Lluberas & Joaquín Saldain, 2014. "Paper or plastic? Payment instrument choice in Uruguay," Documentos de trabajo 2014007, Banco Central del Uruguay.
    7. Mark Armstrong Author-Email: mark.armstrong@ucl.ac.uk Author-Workplace-Name: University College of London, 2006. "Competition in Two-Sided Markets," RAND Journal of Economics, The RAND Corporation, vol. 37(3), pages 668-691, Autumn.
    8. Elizabeth Bucacos & Gerardo Licandro, 2002. "Acerca de la estabilidad de la demanda de dinero. El caso de Uruguay: 1979.4-2002.3," Documentos de trabajo 2002001, Banco Central del Uruguay.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Gandelman, Néstor & Lluberas, Rodrigo & Misail, Daniel & IDB Invest, 2023. "The Impact of a Financial Inclusion Program on Household’s Payment Choice, Savings, and Credit," IDB Publications (Working Papers) 12769, Inter-American Development Bank.
    2. Rodrigo Lluberas, 2018. "The effect of government intervention on households' payment instrument choice," Documentos de trabajo 2018010, Banco Central del Uruguay.
    3. Rodrigo Lluberas & Joaquín Saldain, 2014. "Paper or plastic? Payment instrument choice in Uruguay," Documentos de trabajo 2014007, Banco Central del Uruguay.

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    More about this item

    Keywords

    payment instruments; consumer behavior; multinomial logit model;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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