The paper presents a model of a payment card association which provides payment cards as well as ATM services. Consumers are able to substitute cards by cash and regard cash as an inferior substitute for a debit card. I analyze the role of some widely accepted interchange agreements, such as the...

The payment cards market is a two-sided market. Cost sensitivity of both consumers and merchants for card services influences total demand. Survey data of Dutch merchants shows that costs, and competition affect acceptance as well as surcharging decisions. Merchants who find payment cards...

Standard economics provides a well-understood framework of the competitive determinants of market prices that is now widely accepted for antitrust analysis. In “two-sidedmarkets,” where firms supply products demanded by two interrelated groups of consumers, these competitive forces operate...