Consumer Welfare of Alternative Payment Methds

Fernando Alvarez
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Fernando Alvarez: University of Chicago

No 1533, 2019 Meeting Papers from Society for Economic Dynamics

Abstract: In several Latin American countries, and in Mexico in particular, Uber rides can be paid with cash, credit card, or Uber card/gift card (pre-paid card). We conduct price experimentation on the different payments methods, as well as in the adoption of credit card and/or Uber/gift card. Additionally, we use a difference-in-difference approach to take advantage of the fact that cash was never allowed as a payment method in Mexico City, but it is allowed in the neighboring counties. We measure the consumer surplus accruing from using cash as a payment method, i.e. a measure of the net benefits accrued to riders for being able to use cash as a payment method.

Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed019:1533

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