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dc.contributor.authorArango, Carlosen_US
dc.contributor.authorHuynh, Kim P.en_US
dc.contributor.authorSabetti, Leonarden_US
dc.description.abstractThis paper uses discrete-choice models to quantify the role of consumer socioeconomic characteristics, payment instrument attributes, and transaction features on the probability of using cash, debit card, or credit card at the point-of-sale. We use the Bank of Canada 2009 Method of Payment Survey, a two-part survey among adult Canadians containing a detailed questionnaire and a three-day shopping diary. We find that cash is still used intensively at low value transactions due to speed, merchant acceptance, and low costs. Debit and credit cards are used more frequently for higher transaction values where safety, record keeping, the ability to delay payment and credit card rewards gain prominence. We present estimates of the elasticity of using a credit card with respect to credit card rewards. Reward elasticities are a key element in understanding the impact of retail payment pricing regulation on consumer payment instrument usage and welfare.en_US
dc.publisher|aBank of Canada |cOttawaen_US
dc.relation.ispartofseries|aBank of Canada Working Paper |x2011,23en_US
dc.subject.keywordBank notesen_US
dc.subject.keywordEconometric and statistical methodsen_US
dc.subject.keywordFinancial servicesen_US
dc.titleHow do you pay? The role of incentives at the point-of-saleen_US
dc.typeWorking Paperen_US

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