The Demand for Stored Value Payment Instruments
Due to their functionality, stored value purses based on smart card technology are prominent candidates for being the dominant medium of exchange for micropayments. However, the overall prospects of these payment systems are yet ambiguous, both from the perspective of practice and monetary theory, because their potential to substitute for cash is still largely unknown. As a contribution to the field, a model is proposed founding the potential utilization of stored value cards in microeconomic calculus. As a result, the model provides insight into the crucial parameters determining usage. Moreover, the model suggests that issuers should maximize demand and profits by offering interest payments or insurance against loss.
|Date of creation:||19 Apr 2002|
|Date of revision:|
|Note:||Type of Document - Tex; prepared on IBM PC - PC-TEX; pages: 10; figures: included|
|Contact details of provider:|| Web page: http://220.127.116.11|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Shy, Oz & Tarkka, Juha, 1998.
"The Market for Electronic Cash Cards,"
Research Discussion Papers
21/1998, Bank of Finland.
- Casey B. Mulligan & Xavier Sala-i-Martin, 1995.
"Adoption of financial technologies: Implications for money demand and monetary policy,"
Economics Working Papers
134, Department of Economics and Business, Universitat Pompeu Fabra.
- Mulligan, Casey B & Sala-i-Martin, Xavier, 1996. "Adoption of Financial Technologies: Implications for Money Demand and Monetary Policy," CEPR Discussion Papers 1358, C.E.P.R. Discussion Papers.
- Casey B. Mulligan & Xavier Sala-i-Martin, 1996. "Adoption of Financial Technologies: Implications for Money Demand and Monetary Policy," NBER Working Papers 5504, National Bureau of Economic Research, Inc.
- Anthony M. Santomero & John J. Seater, 1996.
"Alternative monies and the demand for media of exchange,"
Board of Governors of the Federal Reserve System (U.S.), pages 942-964.
- Santomero, Anthony M & Seater, John J, 1996. "Alternative Monies and the Demand for Media of Exchange," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 28(4), pages 942-60, November.
- Anthony M. Santomero & John J. Seater, 1995. "Alternative Monies and the Demand for Media of Exchange," Center for Financial Institutions Working Papers 96-08, Wharton School Center for Financial Institutions, University of Pennsylvania.
- C.K. Folkertsma & G.E. Hebbink, 1998. "Cash management and choice of payment media: a critical survey of the theory," WO Research Memoranda (discontinued) 532, Netherlands Central Bank, Research Department.
- James J. McAndrews, 1997. "Network issues and payment systems," Business Review, Federal Reserve Bank of Philadelphia, issue Nov, pages 15-25.
- Nicholas Economides, . "Network Economics with Application to Finance," Financial Networks _004, Economics of Networks.
- M. Reichenbach & T. Grzebiela & T. Koltzsch & I. Pippow, 2002. "Individual Risk Management for Digital Payment Systems," Computational Economics 0204001, EconWPA.
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpmi:0204002. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA)
If references are entirely missing, you can add them using this form.