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Consumer Payment Choice in the Fifth District: Learning from a Retail Chain

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Abstract

This paper studies payment variation across locations and time using five years of transactions data from a large discount retail chain with hundreds of stores across the Fifth District. The results show that the median transaction size, demographics, education levels, and state fixed effects are the top factors in explaining cross-location payment variation in the sample. We also identify interesting time patterns of payment variation, particularly the longer-term decline in the cash share of transactions largely replaced by debit.

Suggested Citation

  • Zhu Wang & Alexander L. Wolman, 2016. "Consumer Payment Choice in the Fifth District: Learning from a Retail Chain," Economic Quarterly, Federal Reserve Bank of Richmond, issue 1Q, pages 51-78.
    • Handle: RePEc:fip:fedreq:00042
    DOI: 10.21144/eq1020102
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    References listed on IDEAS

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    payments; consumer behavior;

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