15/11/20
Card-Sales Response to Merchant Contactless Payment Acceptance: Causal Evidence
Disruptive innovations in digital payments are happening in a large number of countries around the world. While consumers may access to a wide variety of payment technologies, a natural question arises: does accepting a new payment technology allow merchants to increase their business sales? Using matching and difference-in-difference techniques on a unique sample of about 275,580 merchants in France, we find that accepting contactless payments in 2018 increases on average the card-sales amount by 17 percent (and by 20 percent the card-sales count) compared to merchants who do not accept contactless payments. We also find evidence that accepting contactless payments exerts a positive spillover of about 3 percent in the amount of contact card sales, and is also more profitable for small merchants and new entrepreneurs.
02/11/20
- documents de travail
Digital Currencies and Bank Competition
This article examines how the issuance of a Digital Currency by a non-bank operator impacts competition between banks in a cashless society. I analyze how the fee charged for the digital currency impacts the interest rates on loans and the fees charged by banks to depositors for paying by card and opening an account in a bank. I derive the conditions under which consumers use the digital currency to pay.
20/07/20
- documents de travail
Market for Information and Selling Mechanisms
This article analyzes how the selling mechanisms used by a data intermediary impact the optimal information structure sold to competing firms. We analyze how take it or leave it offers, sequential bargaining, and auctions, change the bargaining power between the data intermediary and competing firms, impacting the price of information, and the amount of data collected on the market for information. We highlight conflicting interests between data intermediaries, data protection agencies and competition authorities, and we discuss regulatory implications.
11/06/20
- documents de travail
Online Commerce, Inter-Regional Retail Trade, and the Evolution of Gravity Effects: Evidence from 20 Billion Transactions
This paper investigates inter-regional retail trade linkages, and changes in the gravity effects between cities and regions arising from online commerce, as opposed to traditional point-of-sale commerce. We build original inter-regional retail trade measures from nearly 20 billion domestic consumer online and in-store transactions made through bank cards, in France 2018-19. We are able to study the mobility of individual bank card holders throughout France, their on-site purchases, and also the locations from which their online purchases were made. We find evidence that online consumer expenditure tends to be more heavily concentrated in the already-large regional economies. This result suggests that the increasing movement toward online purchasing may tend to increase the concentration of overall economic activity, and may have important implications for regional economic development.
29/04/20
- documents de travail
Consumers' Mobility, Expenditure and Online-Offline Substitution Response to COVID-19: Evidence from French Transaction Data
This paper investigates a number of general phenomena connected with consumer behaviour in response to a severe economic shock, using billions of French card transactions measured before and during the COVID-19 epidemic. We examine changes in consumer mobility, anticipatory behaviour in response to announced restrictions, and the contrasts between the responses of online and traditional point-of-sale (off-line) consumption expenditures to the shock. We track hourly, daily and weekly responses as well as estimating an aggregate fixed-period impact effect via a difference-in-difference estimator. The results, particularly at the sectoral level, suggest that {recourse} to the online shopping option diminished somewhat the overall impact of the shock on consumption expenditure, thereby increasing resiliency of the economy.
12/03/20
- documents de travail
Flexible and Context-Specific AI Explainability: A Multidisciplinary Approach
The recent enthusiasm for artificial intelligence (AI) is due principally to advances in deep learning. Deep learning methods are remarkably accurate, but also opaque, which limits their potential use in safety-critical applications. To achieve trust and accountability, designers and operators of machine learning algorithms must be able to explain the inner workings, the results and the causes of failures of algorithms to users, regulators, and citizens. The originality of this paper is to combine technical, legal and economic aspects of explainability to develop a framework for defining the "right" level of explain-ability in a given context. We propose three logical steps: First, define the main contextual factors, such as who the audience of the explanation is, the operational context, the level of harm that the system could cause, and the legal/regulatory framework. This step will help characterize the operational and legal needs for explanation, and the corresponding social benefits. Second, examine the technical tools available, including post hoc approaches (input perturbation, saliency maps...) and hybrid AI approaches. Third, as function of the first two steps, choose the right levels of global and local explanation outputs, taking into the account the costs involved. We identify seven kinds of costs and emphasize that explanations are socially useful only when total social benefits exceed costs.
