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on Payment Systems and Financial Technology |
| By: | Gianluca Orefice; Nicholas Sly; Farid Toubal |
| Abstract: | Using detailed administrative data linking French firms and workers over the years 2002-2007, we document a distinct U-shaped pattern in worker-level wages surrounding the time their employer is acquired by a foreign firm, with a dip in earnings observed in years just before domestic firms switch to MNE status. The dip in earnings is evident in both wages and in-kind payments given to workers. To guide our empirical approach, we present a simple model with fair wage considerations among workers and endogenous cross-border acquisition activity that predicts this U-shaped pattern, and characterizes the selection of domestic targets for acquisition by an MNE. |
| Keywords: | multinational enterprises;wage premium;in-kind payments;fair wages |
| JEL: | F14 F23 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2015-27&r=pay |
| By: | Ggombe Kasim Munyegera (National Graduate Institute for Policy Studies); Tomoya Matsumoto (National Graduate Institute for Policy Studies) |
| Abstract: | Over 35 percent of the adult use mobile money services in 2014, just five years since its inception in Uganda. Using household survey data covering 820 rural households, we examine the effect of this financial innovation on their financial behavior. We find that adopting mobile money services significantly increases the likelihood of saving, borrowing and receiving remittances due to reduction in transaction cost. The amount of savings, credit and remittances is also significantly higher among user households than non-users. To illustrate the importance of service proximity, we show that reducing the distance to the nearest mobile money agent boosts the frequency of using mobile money services. Our results are robust to specification changes and alternative explanations. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ngi:dpaper:15-20&r=pay |
| By: | Connolly, Sean (Boston University); Stavins, Joanna (Federal Reserve Bank of Boston) |
| Abstract: | Today’s consumer has access to more payment instruments than consumers of just a few years ago. As the number of available payment methods increases, so does the need to understand why consumers adopt certain payment instruments, how consumers choose to pay for purchases, which consumers make certain payments, and who is most affected by changes in the payment system. Previous literature that examined the association between consumer payment behavior and consumer demographic information was based on data from a single time period. This paper contributes to the literature on this topic by reporting, for the first time, demographic trends in consumer adoption and use of several payment instruments over the period of five consecutive years from 2009 to 2013. |
| JEL: | D12 D14 |
| Date: | 2015–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbdr:15-6&r=pay |
| By: | Hitczenko, Marcin (Federal Reserve Bank of Boston) |
| Abstract: | Making meaningful inferences based on survey data depends on the ability to recognize and adjust for discrepancies between the survey respondents and the target population; this partly involves understanding how survey samples differ with respect to heterogeneous clusters of the population. Ex post adjustments for unbiased population parameter estimates are usually based on easily measured variables with known distributions in the target population, like age, gender, or income. This paper focuses on identifying and assessing the effect of an overlooked source of heterogeneity and potential selection bias related to household structure and dynamics. In household economies, tasks are often concentrated among a subset of the household members, so individual differences in behavior are related to performing different roles within the household. When the sampling involves selecting individuals from within households, a tendency to choose certain types of members for participation in a survey can result in unrepresentative samples and biased estimates for any variable relating to the respondent's household duties. The Boston Fed's Survey of Consumer Payment Choice (SCPC) seeks to estimate parameters, such as the average number of monthly payments, for the entire U.S. population. This data report exploits the fact that in the 2012 SCPC some respondents come from the same household, a unique feature that enables a study of the presence and ramifications of this type of selection bias when asking about household financial decisionmaking and payment choice. Using a two-stage statistical analysis, the survey answers are adjusted for a response error to estimate a latent variable that represents each respondent's share of financial responsibility for the household. |
| Keywords: | survey error; household economics; Dirichlet regression; Survey of Consumer Payment Choice |
| JEL: | C11 C42 D12 D13 |
| Date: | 2015–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbdr:15-7&r=pay |
| By: | Kelly, Robert (Central Bank of Ireland); McCann, Fergal (Central Bank of Ireland) |
| Abstract: | The resolution of the long-term mortgage arrears (those in arrears greater than one year; LTMA) crisis represents one of the key policy challenges in Ireland today. In this Letter we highlight the range of economic and demographic characteristics associated with the experience of LTMA in Ireland. Our analysis suggests that unemployment shocks, changes in mortgage affordability, the accumulation of non-mortgage debt, higher originating loan-to-value ratios and weak housing equity positions all have an important explanatory role. We also outline repayment patterns among households at differing levels of mortgage arrears. It is shown that in 2014, over three quarters of those in LTMA had continued increases in their arrears balances. This contrasts with those in the early stages of arrears, where less than half of all borrowers had arrears increases. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:cbi:ecolet:11/el/15&r=pay |
| By: | Herbst-Murphy, Susan (Federal Reserve Bank of Philadelphia); Weed, Greg (Phoenix Marketing International) |
| Abstract: | Overall growth in general purpose reloadable prepaid card ownership was not as robust between 2013 and 2014 as it was between 2012 and 2013 except in one notable segment: high-income Millennials. This same demographic group also exhibited a strong propensity to use alternative financial services along with traditional bank products. This paper further explores this group of “hybrid” financial services consumers. It also examines the broader use of financial services by young adults and reports on ways in which their choices differ from those of older consumers, along with evidence that conventional services are also used to the same — in some cases, even greater — degree as their parents’ and grandparents’ generations. The findings are sometimes counterintuitive, particularly with regard to some stereotypes about this young generation that have been put forth. Because of the size of this cohort, their behaviors could influence what the future of financial services consumption and delivery may look like. |
| Keywords: | GPR prepaid cards; Millennials; Alternative financial services; General purpose reloadable cards; |
| JEL: | D1 |
| Date: | 2015–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpdp:15-06&r=pay |
| By: | Seppälä, Timo; Mattila, Juri |
| Abstract: | In the Europe 2020 strategy, the European Commission has defined trust and security as one of the seven key pillars of its digital agenda. This decision, of course, is not a difficult one to rationalize. Without trust and security, the prospects of benefiting from any kind of a network of systems are extremely limited — no matter how interoperable and pervasive the network in itself may be. |
| Date: | 2016–01–07 |
| URL: | http://d.repec.org/n?u=RePEc:rif:briefs:42&r=pay |
| By: | Hoseini, Mohammad (Tilburg University, Center For Economic Research) |
| Abstract: | Under the VAT, formal traders report their purchases to the administration for a<br/>deduction in their VAT bill. This paper models this third-party reporting feature of the VAT in an input-output economy and quantifies it among different activities using a forward linkages index. The administration can reduce the size of shadow economy by reallocating visiting audits to backwardly linked activities and cross-checking VAT payments with input credit claims in forwardly linked activities. Empirical evidence from Indian service sector justifies the assumptions and suggests a significant increase in the tax compliance of forwardly linked activities following VAT adoption in 2003. |
| Keywords: | Value-added tax; Informality; Tax enforcement; Linkage analysis |
| JEL: | H26 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiucen:56358907-5e47-49f6-9a74-f59c0b69c49b&r=pay |
| By: | Arianna Galliera (Department of Economics, University Of Venice Cà Foscari); Noemi Pace (Department of Economics, University Of Milan, Bicocca) |
| Abstract: | The incentive scheme selected in a laboratory experiment might trigger different type of behavior in participants. This paper is an attempt to screen the strategies adopted by agents in a bargaining game when buyer and seller have partly conflicting interests and are asymmetrically informed. We allow participants to choose the incentive scheme through which they will be paid at the end of the experiment controlling for past experience and individual characteristics. It is well known that payment method is highly correlated to the risk preferences shown by individuals, but little research is devoted to the analysis of the behavior induced by Random Lottery Incentive scheme (RLI for short) and Cumulative Scheme payment (CS for short) both on individual and social results. This paper aims to fill the gap. |
| Keywords: | bargaining, experiment, gender, payment scheme. |
| JEL: | C78 C91 D82 J16 J33 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2015:33&r=pay |