Coordination on Use of Non-deferred Electronic Payment Instruments
- Authors
- Huang, Pidong; Lee, Manjong
- Issue Date
- 2015
- Publisher
- KOREAN ECONOMIC ASSOCIATION
- Keywords
- Cash; Coordination; Electronic Payment; Strategic Complementarities
- Citation
- KOREAN ECONOMIC REVIEW, v.31, no.1, pp.5 - 24
- Indexed
- SSCI
SCOPUS
KCI
- Journal Title
- KOREAN ECONOMIC REVIEW
- Volume
- 31
- Number
- 1
- Start Page
- 5
- End Page
- 24
- URI
- https://scholar.korea.ac.kr/handle/2021.sw.korea/94888
- ISSN
- 0254-3737
- Abstract
- In the use of electronic payment technology, there is strategic complementarity and hence room for self-fulfilling multiple equilibria. But existing relevant literature is silent about how agents' expectations become coordinated. This paper resolves the coordination problem in the use of a non-deferred electronic means of payment, which can be represented by a debit card. We focus on that because it is almost a perfect substitute for cash. The presence of exogenous shocks that have a fundamental impact on the cost of the technology makes agents coordinate their expectations in a particular way. We also show that a high inflation and a distortionary financing scheme for debit-card transactions cost disturb coordination in the use of debit cards.
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Collections - College of Political Science & Economics > Department of Economics > 1. Journal Articles
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