Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259747 
Year of Publication: 
2020
Citation: 
[Journal:] Swiss Journal of Economics and Statistics [ISSN:] 2235-6282 [Volume:] 156 [Issue:] 1 [Article No.:] 5 [Publisher:] Springer [Place:] Heidelberg [Year:] 2020 [Pages:] 1-35
Publisher: 
Springer, Heidelberg
Abstract: 
This paper explores the impact of contactless payment on consumers' demand for cash at an early stage of diffusion. The specific devices that are investigated are debit and credit cards, in which the feature is embedded. A novel balanced panel dataset drawn from representative surveys on consumer payment behavior in the USA from 2009 to 2013 is analyzed to account for unobserved heterogeneity in cash usage. The results show that contactless credit and debit cards exert no statistically significant effect on cash usage after controlling for unobserved heterogeneity. Consumers' decision to use contactless payment is an endogenous choice. Card-affined individuals replace conventional card payments with contactless card payments. Hence, the overall effect on cash usage remains unaffected.
Subjects: 
Contactless payment
Money demand
Cash usage
Credit cards
Debit cards
JEL: 
C33
D12
E41
E42
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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