To Surcharge or Not to Surcharge: An Empirical Investigation of ATM Pricing

Timothy Hannan, Elizabeth K. Kiser, Robin A. Prager and James McAndrews
Additional contact information
Elizabeth K. Kiser: Board of Governors of the Federal Reserve System (T.H.H., E.K.K., R.A.P.) and Federal Reserve Bank of New York (J.J.M.)
Robin A. Prager: Board of Governors of the Federal Reserve System (T.H.H., E.K.K., R.A.P.) and Federal Reserve Bank of New York (J.J.M.)

The Review of Economics and Statistics, 2003, vol. 85, issue 4, 990-1002

Abstract: This paper investigates depository institutions' decisions whether or not to impose surcharges (direct usage fees) on nondepositors who use their ATMs. In addition to documenting patterns of surcharging, we examine motives for surcharging, including both direct generation of fee revenue and the potential to attract deposit customers who wish to avoid incurring surcharges at an institution's ATMs. Consistent with expectations, we find that the probability of surcharging increases with both the institution's share of market ATMs and the time since surcharging was first allowed in the state, and decreases with increasing local ATM density. Further, we find evidence consistent with the use of surcharges to attract deposit customers who are new to the local banking market, but we find no evidence that larger banks use surcharges as a means to attract existing customers away from smaller local competitors. © 2003 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Date: 2003
References: Add references at CitEc
Citations: View citations in EconPapers (46)

Downloads: (external link)
http://www.mitpressjournals.org/doi/pdf/10.1162/003465303772815880 link to full text (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: To surcharge or not to surcharge: an empirical investigation of ATM pricing (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tpr:restat:v:85:y:2003:i:4:p:990-1002

Ordering information: This journal article can be ordered from
https://mitpressjour ... rnal/?issn=0034-6535

Access Statistics for this article

The Review of Economics and Statistics is currently edited by Pierre Azoulay, Olivier Coibion, Will Dobbie, Raymond Fisman, Benjamin R. Handel, Brian A. Jacob, Kareen Rozen, Xiaoxia Shi, Tavneet Suri and Yi Xu

More articles in The Review of Economics and Statistics from MIT Press
Bibliographic data for series maintained by The MIT Press ().