Rochet, Jean Charles; Tirole, Jean - In: International Journal of Industrial Organization 26 (2008) 6, pp. 1333-1347
Payment card associations offer both debit and credit cards and sometimes engage in a tie-in on the merchant side through the so-called honor-all-cards (HAC) rule. This article analyzes the impact of the HAC rule, using a simple model with two types of transactions subject to different...