Consumer Payment Preferences, Network ...
Document type :
Compte-rendu et recension critique d'ouvrage
Title :
Consumer Payment Preferences, Network Externalities, and Merchant Card Acceptance: An Empirical Investigation
Author(s) :
Bounie, David [Auteur]
François, Abel [Auteur]
Lille économie management - UMR 9221 [LEM]
Hove, Leo Van [Auteur]
François, Abel [Auteur]
Lille économie management - UMR 9221 [LEM]
Hove, Leo Van [Auteur]
Journal title :
Review of Industrial Organization
Pages :
257–290
Publisher :
Springer US
Publication date :
2016-09
ISSN :
0889-938X
English keyword(s) :
Consumer preferences
Merchants
Network externalities
Payment cards
Retail payments
Two-sided markets
Merchants
Network externalities
Payment cards
Retail payments
Two-sided markets
HAL domain(s) :
Sciences de l'Homme et Société/Economies et finances
English abstract : [en]
The two-sided market theory holds that consumer adoption and merchant acceptance of payment cards are interdependent. However, empirical evidence on such network externalities is scarce, especially for the merchant side. ...
Show more >The two-sided market theory holds that consumer adoption and merchant acceptance of payment cards are interdependent. However, empirical evidence on such network externalities is scarce, especially for the merchant side. This paper addresses this issue by examining merchant card acceptance in France. We exploit shopping diary data to construct a novel and fine-grained measure of French consumers’ payment preferences and match these with data from a nation-wide merchant survey. Controlling for (among other factors) cost, degree of competition, and customer characteristics, we find that the higher the probability that the average basket of a merchant is paid for by card in shops in the same sector and region, the higher the probability that the merchant will accept cards. In other words, we find that consumer preferences drive merchant card acceptance, which underpins the existence of network externalities on the merchant side of the payment card market.Show less >
Show more >The two-sided market theory holds that consumer adoption and merchant acceptance of payment cards are interdependent. However, empirical evidence on such network externalities is scarce, especially for the merchant side. This paper addresses this issue by examining merchant card acceptance in France. We exploit shopping diary data to construct a novel and fine-grained measure of French consumers’ payment preferences and match these with data from a nation-wide merchant survey. Controlling for (among other factors) cost, degree of competition, and customer characteristics, we find that the higher the probability that the average basket of a merchant is paid for by card in shops in the same sector and region, the higher the probability that the merchant will accept cards. In other words, we find that consumer preferences drive merchant card acceptance, which underpins the existence of network externalities on the merchant side of the payment card market.Show less >
Language :
Anglais
Popular science :
Non
Collections :
Source :