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on Payment Systems and Financial Technology |
| By: | Fulford, Scott L. (Boston College); Schuh, Scott (Federal Reserve Bank of Boston) |
| Abstract: | Despite the centrality of credit and debt in the financial lives of Americans, little is known about how U.S. consumers' access and utilization of credit changes in the short and long term, and how these changes are related to changes in U.S. consumers' debt. This paper uses data from the Federal Reserve Bank of New York Consumer Credit Panel (CCP), which contains a 5 percent sample of every credit account in the United States from 1999 to 2014 from the credit reporting agency Equifax. It examines how changing credit availability, debt, and utilization over the business cycle and the life cycle and across individuals relate to U.S. consumers' patterns of incurring, carrying, and paying off their debts. Much of this paper focuses on credit cards, since these have observable limits and are widely held, but the paper also briefly examines other forms of debt over the consumer life cycle. |
| JEL: | D14 D91 E21 |
| Date: | 2015–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:15-17&r=pay |
| By: | Murendo, Conrad; Wollni, Meike |
| Abstract: | Despite the fact that the use of mobile money technology has been spreading rapidly in developing countries, empirical studies on the broader welfare effects of the technology on rural households are still limited. Using household survey data, we analyse the effect of mobile money on household food security in Uganda. Unlike previous studies that rely on a single measure of food security, we measure food security using two indicators – a food insecurity index and food expenditures. To account for selection bias in mobile money use, we estimate treatment effects and instrumental variables regressions. Our results indicate that the use of mobile money per se as well as the volumes transferred are associated with a reduction in food insecurity. Furthermore, the use, frequency of use, and volumes of mobile money transferred are associated with increases in food expenditures. Policy interventions and strategies aiming to improve household food security should consider the promotion of mobile money among rural households in Uganda and other developing countries as a promising instrument. |
| Keywords: | mobile money, food security, households, Uganda, Consumer/Household Economics, Financial Economics, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, International Development, G29, I31, O16, O33, |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gagfdp:229805&r=pay |
| By: | Vítor Castro (Faculty of Economics, University of Coimbra, and Economic Policies Research Unit (NIPE)); Abdellah Bouchellal (Laboratoire d'Economie d'Orléans 2, Université d'Orléans, CNRS) |
| Abstract: | In this paper, we analyse whether the likelihood of the bank-firm relationships ending is dependent on their age or not and whether the respective behaviour is smooth or changes over their length. A parametric duration analysis is employed in this analysis. We start by estimating a continuous-time Weibull duration model over the duration of the relationships between 1185 firms and one of the major French banks. Our findings show that the likelihood of the relationships between them ending increases over their duration, but other specific factors to the firms, to the bank, to their own relationship and certain pricing conditions also play an important role in the duration of those relationships. Additionally, we extend the baseline Weibull duration model in order to allow for changepoints in the duration dependence parameter. The empirical findings support the presence of a change-point: positive duration dependence is observed for those relationships that last less than 23 years, but no evidence of duration dependence is found for longer events. Hence, we conclude that the likelihood of these relationships ending increases over time, but only until about 23 years of duration; then the relations become stronger and the likelihood of they ending is no longer dependent on its duration but on other conditionings. |
| Keywords: | Bank-firm relationships, duration analysis, duration dependence, change-points |
| JEL: | C41 G21 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:1/2016&r=pay |
| By: | Merima Ali; Abdulaziz B. Shifa; Abebe Shimeles; Firew Woldeyes |
| Abstract: | Limited fiscal capacity poses a significant challenge in developing countries. To mitigate this challenge, the adoption of electronic tax systems has been at the forefront of tax reforms; however, there is little systematic empirical evidence on the impact of such reforms. We attempt to narrow this gap by documenting evidence from Ethiopia where there has been a recent surge in the use of electronic sales registry machines (ESRMs). Using administrative data covering all business taxpayers, we find that ESRM use resulted in a large and significant increase in tax payments. Moreover, this effect is driven by firms that were more likely to evade taxes prior to ESRM use. The results highlight the potential role that information technology may play in strengthening state fiscal capacity in developing countries. |
| Keywords: | Developing economy; fiscal capacity; information technology; taxation. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:chm:wpaper:wp2015-12&r=pay |
| By: | Laura Panza; David Merrett |
| Abstract: | The motivation for this paper is to discover the arrangements made by banks to settle the world’s financial payments in the 1930s. Drawing from transaction cost theory we show that correspondent banking relationships were more important and widespread than multinational banks’ branches. The argument is then tested empirically by a gravity model using an instrumental Poisson pseudomaximum likelihood estimation strategy. We find that the strength of bilateral trade, the presence of financial centres, colonial linkages and the size of the financial sector in host countries drove the choice between branches and correspondents. |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:auu:hpaper:030&r=pay |
| By: | Rahul Mehrotra; Vincent Somville; Lore vandewalle |
| Abstract: | Recent evidence highlights the importance of trust in explaining bank account savings. According to economic theory, repeated interactions can play a crucial role in shaping trust. We designed the first field experiment that tests whether increased interactions between clients and bankers influence a client's trust in bankers. We promoted interactions by randomly (i) opening accounts for the unbanked and (ii) making weekly payments on their accounts. At the end of these interventions, we measured trust by playing trust games between clients on the one hand, and their own local banker as well as an anonymous other banker on the other hand. The only intervention that has a signicant impact on the number of interactions is opening a bank account. It also greatly increases trust in the anonymous banker, but not in their own banker. Next, we investigate the importance of trust for account savings. We find a strong positive correlation between the clients' trust in their own banker and savings in the account, but their trust in another banker does not correlate with savings. From the decomposition of trust in its different determinants, we learn that expected trustworthiness matters most in explaining savings, while there is a minor role for social preferences and no role for risk attitudes. We conclude that the personalized client-banker relationships are crucial, but not malleable. Strategies which can deal with the expected trustworthiness - such as providing access to an ATM, or to a denser network of local bankers - might promote bank account savings. |
| Keywords: | India finance trust savings banking experiment rct |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:chm:wpaper:wp2016-02&r=pay |