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Mobility restrictions and payment choices: The case of the Covid-19 pandemic

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  • Carbó-Valverde, Santiago
  • Cuadros-Solas, Pedro J.
  • Rodríguez-Fernández, Francisco
  • Sánchez-Béjar, José Juan

Abstract

This paper examines the impact of the Covid-19 mobility restrictions on the payment choices at brick-and-mortar establishments. The asymmetries in the implementation of the Covid-19 mobility restrictions across the Spanish provinces serves as a quasi-natural experiment. The findings show that the severity of the mobility restrictions had an impact on payment choices. Individuals in areas with more stringent restrictions were less likely to use cash. The effect of the mobility restrictions on cash usage was larger among those with lower financial education. However, the severity of the mobility restrictions did not significantly affect the adoption of the most sophisticated digital payment methods like digital wallets. Consumer concerns about Covid-19 transmission through cash did not drive these results. Using a recent survey conducted in a post-pandemic context, where mobility restrictions have been lifted, the impact of mobility restrictions on cash usage has persisted. The main results hold after several robustness tests.

Suggested Citation

  • Carbó-Valverde, Santiago & Cuadros-Solas, Pedro J. & Rodríguez-Fernández, Francisco & Sánchez-Béjar, José Juan, 2023. "Mobility restrictions and payment choices: The case of the Covid-19 pandemic," Journal of Behavioral and Experimental Finance, Elsevier, vol. 40(C).
    • Handle: RePEc:eee:beexfi:v:40:y:2023:i:c:s2214635023000643
    DOI: 10.1016/j.jbef.2023.100850
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    More about this item

    Keywords

    Covid-19; Payments; Mobility restrictions; Cash;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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