October 21, 2010, 12:30–14:00
Toulouse
Room MC 205
Decision Mathematics Seminar
Abstract
In Australia, on the 3rd of March 2009, the interchange fees on shared ATM transactions were removed and replaced by fees directly set and received by the ATM owners. We develop a model to study how the entry of independent ATM deployers (IADs) affects welfare under this direct charging scheme. Paradoxically, we show that the IAD entry benefits banks. It may be good for consumers if they sufficiently value the associated growth of the ATM network.
JEL codes
- G2: Financial Institutions and Services
- L1: Market Structure, Firm Strategy, and Market Performance