An introduction to the economics of payment card networks

Robert Hunt

No 03-10, Working Papers from Federal Reserve Bank of Philadelphia

Abstract: Open payment card networks typically coordinate the activities of thousands of financial institutions that issue cards, millions of retail locations that accept them, and several hundred million consumers that use them. This coordination can include the collective setting of certain prices and other controversial network rules. Such practices have recently come under the scrutiny of antitrust authorities in the U.S. and abroad. This paper provides a brief overview of the economics of the payment card industry, explaining some of the differences from the textbook model of competitive markets. Such differences are important factors for the antitrust analysis of payment card networks. ; Also issued as Payment Cards Center Discussion Paper No. 03-08

Keywords: Payment; systems (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (36)

Published in Review of Network Economics, June 2003, pp 80-96

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