In:
The Review of Economics and Statistics, MIT Press, ( 2023-03-15), p. 1-25
Abstract:
We use a nonlinear reduction in a bank's check-cashing fees and variation in regulated check-clearing times to identify the elasticity of demand for cashing checks rather than depositing them. We find that an extra day of check-clearing time makes account holders 65.5% more likely to cash a check than deposit it, which implies they are willing to pay $11.17 per day for faster access to their funds – an effective annualized discount rate of 11,054% for the average check. We use this elasticity to evaluate recent proposals that mandate faster check-clearing times.
Type of Medium:
Online Resource
ISSN:
0034-6535
,
1530-9142
DOI:
10.1162/rest_a_01308
Language:
English
Publisher:
MIT Press
Publication Date:
2023
detail.hit.zdb_id:
1483322-0
detail.hit.zdb_id:
207961-6
detail.hit.zdb_id:
207962-8
Permalink