nep-pay New Economics Papers
on Payment Systems and Financial Technology
Issue of 2017‒05‒28
nine papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. The promise of blockchain By Demary, Markus; Demary, Vera
  2. Evaluating Market Consolidation in Mobile Communications By Genakos, Christos D.; Valletti, Tommaso; Verboven, Frank
  3. Public Blockchain versus Private blockhain By Dominique Guegan
  4. Subway and "Digital Porosity" of Urban Space By Zaporozhets, Oksana
  5. The Impact of Customer Orientation on Quantity and Quality of User-Generated Content: A Multi-Country Case Study of Mobile Applications By Bosul Yoo; Sotaro Katsumata; Takeyasu Ichikohji
  6. Blockchain: Down to earth By Demary, Markus; Demary, Vera
  7. "On the Centrality of Redemption: Linking the State and Credit Theories of Money through a Financial Approach to Money" By Eric Tymoigne
  8. Evolution of the Electronic Payment Industry: Problems of a Qualitative Transition By Dostov, Viktor; Shoust, Paul
  9. Status Goods: Experimental Evidence from Platinum Credit Cards By Leonardo Bursztyn; Bruno Ferman; Stefano Fiorin; Martin Kanz; Gautam Rao

  1. By: Demary, Markus; Demary, Vera
    Abstract: Digitization affects all sectors of the economy. A new and possibly disruptive digital technology is the blockchain, a decentralized ledger, which seems to offer great promise for many financial and business applications.
    Date: 2017
  2. By: Genakos, Christos D.; Valletti, Tommaso; Verboven, Frank
    Abstract: We study the dual relationship between market structure and prices and between market structure and investment in mobile telecommunications. Using a uniquely constructed panel of mobile operators' prices and accounting information across 33 OECD countries between 2002 and 2014, we document that more concentrated markets lead to higher end user prices. Furthermore, they also lead to higher investment per mobile operator, though the impact on total investment is not conclusive. Our findings are not only relevant for the current consolidation wave in the telecommunications industry. More generally, they stress that competition and regulatory authorities should take seriously the potential trade-off between market power effects and efficiency gains stemming from agreements between firms.
    Keywords: Investments; market structure; mergers; Mobile telecommunications; prices
    JEL: K20 L10 L40 L96
    Date: 2017–05
  3. By: Dominique Guegan (Labex ReFi - Université Paris1 - Panthéon-Sorbonne, CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: In this document, we introduce some thinkings relative to the concept of blockchain, how it works and what are the issues for the banking system. Thus, first we recall what cryptography is, then we introduce the concept of blockchain as a protocol for transmitting information in a secure way, distinguishing two possible approaches: the decentralized public approach and the centralized private approach. The notion of cryptocurrency is introduced and two examples of applications of the public blockchains that are the bitcoin and the etherium are provided.
    Keywords: cryptography ,blockchain
    Date: 2017–04
  4. By: Zaporozhets, Oksana (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: The paper introduces metaphor "digital porosity" aiming to grasp the non-uniformity, limitations and gaps of digital connectivity (technological, material, spatial, social, etc.) in urban spaces. Being used as a research guidance, the metaphor raises the questions what digital porosity is? how is it produced? how is it changing? Based on the research of internet connectedness and practices of Internet use in the subways of Moscow and St. Petersburg, the paper states that the extension of the Internet zone and the inclusion of new urban spaces do not automatically increase the connectivity of the city, since the latter depends not only on the availability or the quality of internet communication, but also on the intentions and skills of the internet users and their ideas about the comfort and the possibility of internet connection, the role of the subway ride in the broader planning horizons
    Date: 2017–05
  5. By: Bosul Yoo (Graduate School of Economics, Osaka University); Sotaro Katsumata (Graduate School of Economics, Osaka University); Takeyasu Ichikohji (Faculty of Business Administration, Toyo University)
    Abstract: This study examines preceding factors of user innovation behavior using a case of smartphone applications to examine indirect and direct effects of consumer attitude on user innovation. Specifically, this study focuses on two aspects of the user innovation evaluation: quality and quantity. Quality of user innovation in particular has the potential to contribute to the profitability of firms that provide SNS or other community services. This study proposes a structural model to examine the relationship between these two user innovation aspects and preceding attitude factors, involvement, consumer knowledge, and customer orientation. The empirical analysis is based on a consumer survey to examine commonalities and differences in two countries: Japan and China. In each country, two services are chosen as representative cases of the user-generated content business model to measure user innovation behaviors based on the two aspects mentioned. By clarifying the preceding factors of user innovation behavior, this study has implications for new business models and future innovation research.
    Keywords: User Innovation, UGC (User-Generated Content), DSMM (Digital, Social Media, and Mobile Marketing), Customer Orientation
    JEL: M31 M15 O30
    Date: 2017–05
  6. By: Demary, Markus; Demary, Vera
    Abstract: The blockchain technology offers the promise to be cheaper, faster, less error-prone and safer compared to traditional financial services. Whether a market for blockchain services will emerge, depends, however, on several criteria.
    Date: 2017
  7. By: Eric Tymoigne
    Abstract: The paper presents a financial approach to monetary analysis that links the credit and state theories of money. A premise of the functional approach to money is that "money is what money does." In this approach, monetary and mercantile mechanics are conflated, which leads to the conclusion that unconvertible monetary instruments are worthless. The financial approach to money strictly separates the two mechanics and argues that major monetary disruptions occurred when the two were conflated. Monetary instruments have always been promissory notes. As such, their financial characteristics are central to their value and liquidity. One of the main financial requirements of any monetary instrument is that it be redeemable at any time. As long as this is the case, the fair value of an unconvertible monetary instrument is its face value. While the functional approach does not recognize the centrality of redemption, the paper shows that redemption plays a critical role in the state and credit views of money. Payments due to issuer and/or convertibility on demand are central to the possibility of par circulation. The paper shows that this has major implications for monetary analysis, both in terms of understanding monetary history and in terms of performing monetary analysis.
    Keywords: Credit Theory of Money; State Theory of Money; Net Present Value; Monetary Systems
    JEL: E31 E42 G12
    Date: 2017–05
  8. By: Dostov, Viktor (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Shoust, Paul (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: The purpose of this work was to conduct a preliminary analysis of the payment services market in the form in which it exists now. To achieve this goal, two groups of tasks were put in effect. First, the regulation of "traditional" business models is considered: their essence and regulation in Russia. Also the authors analyzed the reasons that led to the configuration of the market that developed in Russia by the middle of the 2010s. Secondly, attention was paid to some new technologies and business models, which now, to some extent, go beyond the regulatory perimeter: the services of information intermediation, crowdfunding, P2P lending.
    Date: 2017–05
  9. By: Leonardo Bursztyn; Bruno Ferman; Stefano Fiorin; Martin Kanz; Gautam Rao
    Abstract: This paper provides novel field-experimental evidence on status goods. We work with an Indonesian bank that markets platinum credit cards to high-income customers. In a first experiment, we show that demand for the platinum card greatly exceeds demand for a nondescript control product with identical benefits, suggesting demand for the pure status aspect of the card. Transaction data reveal that platinum cards are more likely to be used in social contexts, implying social image motivations. Combining price variation with information on the use of the card sheds light on the magnitude of the demand for social status. In a second experiment, we provide evidence of positional externalities from the consumption of these status goods. The final experiment shows that increasing self-esteem causally reduces demand for status goods. We infer that part of the demand for status is psychological in nature, and that social image is a substitute for self-image.
    JEL: C93 D03 D12 O12
    Date: 2017–05

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