Baumann, Chakravorti, and Shaaya identify and summarize the recent academic and industry literature on the benefits of large banks from the perspective of economies of scale and scope along with the benefits of a large, diverse set of products and services provided by a large bank. Second, they explore how...
Businesses, both small and large, are adopting new technologies to automate and reduce the exchange of paper documents in their transaction flows. However, more than 80% of payments between businesses are still made with paper checks. As the exchange of information along the supply chain becomes increasingly electronic, it raises...
In this article, Chakravorti and McHugh address why consumers, merchants, and financial institutions are reluctant to embrace electronic payments even though electronic payment networks, such as the credit card and automated clearinghouse (ACH) networks, have existed for more than 25 years. While most Internet-based transactions are primarily processed via credit...
Chakravorti and Roson construct a model to study competing payment networks, where networks offer differentiated products in terms of benefits to consumers and merchants. We study market equilibria for a variety of market structures: duopolistic competition and cartel, symmetric and asymmetric networks, and alternative assumptions about consumer preferences. We find...