The Impact of Contactless Payment on Spending
Trütsch, T.
Abstract:
This paper estimates the effect of contactless payment on the spending ratio in terms of transactions for different transaction types at the point-of-sale. The specific devices that are investigated are debit and credit cards, to which the feature is embedded. Data is drawn from a national representative survey on consumer payment behavior in the US in 2010. Using propensity score matching to control for selection, the estimation shows that the contactless feature yields to a significant increase in the spending ratio at the point-of-sale for both payment methods. The average treatment effect on the treated for credit and debit cards is roughly 8 and 10 percent, respectively. These findings indicate that the private industry can highly benefit from the innovation with respect to new revenue streams. This paper contributes to the existing literature in payment economics by analyzing one of the most recent payment products.
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APA citation
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Trütsch, T. (2014). The Impact of Contactless Payment on Spending. International Journal of Economic Sciences, Vol. III(4), pp. 70-98.