The Effect of Transaction Pricing on the Adoption of Electronic Payments: A Cross-Country Comparison
AbstractPricing should speed up the substitution of low cost electronic payments for expensive paper-based transactions and cash. But by how much? Norway has explicitly priced individual payment transactions and rapidly shifted to electronic payments while the Netherlands has experienced the same shift without direct pricing. Controlling for differences between countries, we estimate the incremental effect of pricing on the shift to electronic payments. If users strongly value the improved convenience or security of electronic payments, pricing–viewed negatively by most consumers–may not be necessary to ensure rapid adoption of electronic payments.
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Bibliographic InfoPaper provided by Netherlands Central Bank, Research Department in its series DNB Working Papers with number 071.
Date of creation: Dec 2005
Date of revision:
electronic payments; transaction pricing; demand elasticity; social benefits;
Other versions of this item:
- Wilko Bolt & David Humphrey & Roland Uittenbogaard, 2005. "The effect of transaction pricing on the adoption of electronic payments: a cross-country comparison," Working Papers 05-28, Federal Reserve Bank of Philadelphia.
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
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