Published in:FRB of Atlanta Working Paper ; No. 2006-25
Extent:
1 Online-Ressource (36 p)
Language:
Not determined
DOI:
10.2139/ssrn.948717
Identifier:
Origination:
Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments November 2006 erstellt
Description:
A controversial aspect of payment cards has been the no-surcharge rule. This rule, which is part of the contract between the card provider and a merchant, states that the merchant cannot charge a customer who pays by card more than a customer who pays by cash. In this paper we consider the design of an optimal card-based payment system when cash is available as an alternative means of payment. We find that a version of the no-surcharge rule emerges as a natural and advantageous feature of such a system