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on Payment Systems and Financial Technology |
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Issue of 2020‒06‒15
eighteen papers chosen by |
| By: | Jens-Uwe Franck; Dimitrios Linardatos |
| Abstract: | As of January 2020, Section 58a of the German Payment Services Supervisory Act (PSSA) provides a right for payment service providers and e-money issuers to access technical infrastructure that contributes to mobile and internet-based payment services. This right of access is intended to promote technological innovation and competition in the consumers’ interests in having a wide choice among payment services, including competing solutions for mobile and internet-based payments. The provision has been dubbed ‘Lex Apple Pay’ as it seems to have been saliently motivated by the objective to give payment service providers the right of direct access to the NFC interfaces of Apple’s mobile devices. In enacting Section 58a PSSA, the German legislature has rushed forwards, overtaking the EU Commission’s ongoing competition investigation into Apple Pay as well as the pending reform of the German Competition Act, which is aimed precisely at operators of technological platforms, which enjoy a gatekeeper position. This article explores the scope of application and the statutory requirements of this right of access as well as available defences and possible legal barriers. We point out that, to restore a level playing field in the internal market, the natural option would be to further harmonize EU payment services regulation, including the availability of a right of access to technical infrastructure for mobile and internet-based payment services and e-money issuers. |
| Keywords: | ‘Lex Apple Pay’; Technology platforms; Antitrust; Payment Services Regulation; Mobile Payment; Access to NFC interfaces; Wallet Apps; Internal Market Regulation |
| JEL: | K21 K22 |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2020_173&r=all |
| By: | Carlo Vercellone (CEMTI - Centre d'études sur les médias, les technologies et l'internationalisation - UP8 - Université Paris 8 Vincennes-Saint-Denis) |
| Abstract: | Cognitive capitalism and the informational revolution have gone hand in hand with a blurring of the boundaries between work and leisure time. At the heart of this evolution is the rise of platform capitalism, and in particular the "merchantable gratuitousness" platforms, like Google and Facebook, which have now taken first place in the ranking of world firms in terms of stock market capitalisation and profitability. Their profit model is based on the logic of multi-sided markets and combines the sale of online advertising and the extraction of user data. The users thus represent both the product and the producers of the main raw material underlying the organisation of the advertising market for merchantable gratuitousness platforms. This is called Free Digital Labor. This concept refers to the activity, apparently both gratuitous and self-governing, performed, often unknowingly, by a multitude of individuals on the internet for the benefit of big internet oligopolies and data industries. The Free Digital Labor thesis is highly controversial. It is often rejected by means of three main arguments: 1. it would be, not labor, but the intangible capital of the algorithm which, through an automated process, would extract and create most of the value; 2. the Free Digital Labor would escape not only the canonical criteria of wage labor, but also the anthropological definition of labor as a conscious and voluntary goal-oriented activity; 3. the free services proposed by the platforms would be remuneration in kind, excluding any relationship of exploitation. Our contribution aims to clarify the terms of this debate and to respond to these objections through a historical and theoretical analysis of the changes in the capital-labor relationship that occurred under the aegis of platform capitalism. |
| Abstract: | Le capitalisme cognitif et la révolution informationnelle sont allés de pair avec un effritement des frontières entre temps de travail et temps libre. Au centre de cette évolution se trouve l'essor du capitalisme des plateformes et notamment des plateformes de la « gratuité marchande » qui, à l'image de Google et Facebook, ont désormais conquis le premières places dans le classement des firmes mondiales en termes de capitalisation boursières et de rentabilité. Leur modèle de profit repose sur la logique des marchés multi-versants et associe la vente de la publicité en ligne et l'extraction des données des usagers. Ces derniers représentent ainsi à la fois le produit et les producteurs de la principale matière première à la base de l'organisation du marché publicitaire des plateformes de la gratuité marchande. C'est ce que l'on nomme le Free Digital Labor. Par ce concept on désigne le travail à la fois gratuit et apparemment libre qu'une multitude d'individus effectue sur internet, souvent inconsciemment, au profit des grands oligopoles du numérique et des data industries. La thèse du Free Digital Labor suscite une vive controverse. Elle est souvent rejetée au moyen de trois principaux arguments : ce serait, non le travail, mais le capital immatériel de l'algorithme qui, par un processus automatisé, extrairait et créerait l'essentiel de la valeur ; le Free Digital Labor échapperait non seulement aux critères canoniques du travail salarié, mais aussi à la définition anthropologique du travail vu comme une activité consciente et volontaire orientée vers un but ; les services gratuits offerts par les plateformes correspondraient à une rémunération en nature excluant tout rapport d'exploitation. Notre contribution se propose d'élucider les termes de ce débat et de répondre à ces objections par une analyse historique et théorique des mutations du rapport capital/travail intervenues sous l'égide du capitalisme des plateformes. ABSTRACT. Cognitive capitalism and the informational revolution have gone hand in hand with a blurring of the boundaries between work and leisure time. At the heart of this evolution is the rise of platform capitalism, and in particular the "merchantable gratuitousness" platforms, like Google and Facebook, which have now taken first place in the ranking of world firms in terms of stock market capitalisation and profitability. Their profit model is based on the logic of multi-sided markets and combines the sale of online advertising and the extraction of user data. The users thus represent both the product and the producers of the main raw material underlying the organisation of the advertising market for merchantable gratuitousness platforms. This is called Free Digital Labor. This concept refers to the activity, apparently both gratuitous and self-governing, performed, often unknowingly, by a multitude of individuals on the internet for the benefit of big internet oligopolies and data industries. The Free Digital Labor thesis is highly controversial. It is often rejected by means of three main arguments: 1. it would be, not labor, but the intangible capital of the algorithm which, through an automated process, would extract and create most of the value; 2. the Free Digital Labor would escape not only the canonical criteria of wage labor, but also the anthropological definition of labor as a conscious and voluntary goal-oriented activity; 3. the free services proposed by the platforms would be remuneration in kind, excluding any relationship of exploitation. Our contribution aims to clarify the terms of this debate and to respond to these objections through a historical and theoretical analysis of the changes in the capital-labor relationship that occurred under the aegis of platform capitalism. |
| Keywords: | Karl Marx KEYWORDS cognitive capitalism,Algorithmes,Free Digital Labor,platform capitalism,multi-sided markets,data,Algorithms,Free Digital Labour,Karl Marx,MOTS-CLES capitalisme cognitif,capitalisme des plateformes,marches multi-versants,données |
| Date: | 2020–04–13 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-02554288&r=all |
| By: | Lucía Pacheco; Pablo Urbiola |
| Abstract: | The digital transformation of financial services has opened up the market to new providers: FinTech start-ups and BigTechs. In this article, we explain how policymakers’ mindset should evolve towards a comprehensive response to ensure the financial sector remains safe, stable and open to competition. The digital transformation of financial services has opened up the market to new providers: FinTech start-ups and BigTechs. In this article, we explain how policymakers’ mindset should evolve towards a comprehensive response to ensure the financial sector remains safe, stable and open to competition. |
| Keywords: | digital markets, mercados digitales, Financial stability, Estabilidad financiera, data, datos, competition policy, política de competencia, Global, Global, Digital Economy, Economía Digital, Financial Markets, Mercados Financieros, Digital Regulation, Regulación Digital, Financial Regulation, Regulación Financiera, Digital Trends, Tendencias Digitales, Working Papers, Documento de Trabajo |
| Date: | 2020–06 |
| URL: | https://d.repec.org/n?u=RePEc:bbv:wpaper:2009&r=all |
| By: | Angelika Welte; Jozsef Molnar |
| Abstract: | This note uses industry data and a unique dataset of small and medium-sized merchants to provide insights into the acquirer-merchant market in Canada. Three main findings are presented. First, smaller merchants pay their acquirer more for every dollar of card payment than larger merchants. Second, this finding is mainly explained by high fixed costs. Third, the acquiring market in Canada is concentrated and has remained fairly stable since 2010. |
| Keywords: | Financial services; Market structure and pricing; Payment clearing and settlement systems |
| JEL: | C2 D2 E4 E42 |
| Date: | 2020–06 |
| URL: | https://d.repec.org/n?u=RePEc:bca:bocadp:20-5&r=all |
| By: | Schilirò, Daniele |
| Abstract: | Digital globalization is a new form of globalization. It brings about relevant changes regarding how business is conducted across borders, the flow of economic benefits, and broadening participation. The growth of data and information related to digital globalization determines that global economic, financial, and social connections increase through digital platforms. Covid-19 is causing a shock to the global economy that is proving to be both faster and more severe than the 2008 global financial crisis. If the current crisis is pushing towards deglobalization, at the same time, Covid-19 represents a challenge for digital globalization and the digital transformation of economies. This research contribution examines the process towards digital globalization that is characterizing the world economy, its impact on businesses, consumers, and governments. It also discusses the challenge that the crisis caused by the coronavirus pandemic is posing to the globalization and digital transformation of economies. |
| Keywords: | digital globalization; fourth industrial revolution; artificial intelligence; Covid-19; deglobalization; digital innovation policy |
| JEL: | D20 D78 F60 L86 O31 |
| Date: | 2020–04 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:100504&r=all |
| By: | Alexander Lipton; Aetienne Sardon; Fabian Sch\"ar; Christian Sch\"upbach |
| Abstract: | This paper provides an overview on stablecoins and introduces a novel terminology to help better identify stablecoins with truly disruptive potential. It provides a compact definition for stablecoins, identifying the unique features that make them distinct from previously known payment systems. Furthermore, it surveys the different use cases for stablecoins as well as the underlying economic incentives for creating them. Finally, it outlines critical regulatory considerations that constrain stablecoins and summarizes key factors that are driving their rapid development. |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2005.12949&r=all |
| By: | Ennis, Sean; Ivaldi, Marc; Lagos, Vicente |
| Abstract: | This paper examines the impact of most favored nation (MFN) clauses on retail prices, taking advantage of two natural experiments that changed vertical contracting between hotels and major digital platforms. The broad E.U. intervention narrowed the breadth of “price parity” obligations between hotels and major Online Travel Agencies (OTAs). Direct sales by hotels to customers subsequently became relatively cheaper. Comparisons with hotel pricing outside the E.U. confirm the reduction in prices for mid-level and luxury hotels. France and Germany went further and eliminated all price-parity agreements. This stronger intervention was associated solely with a significant additional price-reducing effect for mid-level hotels in Germany. Overall, wide MFNs are associated with higher retail prices. Regulating MFNs reduced prices with primary effects coming either from the narrow price-parity intervention or, perhaps, from direct sales becoming cheaper than OTAs in both E.U. and non-E.U. countries, and, interestingly, not from complete elimination of MFNs. |
| Keywords: | Price Parity Clause (PPC); Most favored nation (MFN); Most favored customer (MFC); Hotel Industry; Impact Evaluation; Online Travel Agency (OTA); digital platforms |
| JEL: | K21 L14 L42 L81 |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:124308&r=all |
| By: | Croitor, Evgheni; Adam, Martin |
| Date: | 2020–05–12 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:120678&r=all |
| By: | Cojoc, Anca; Ivaldi, Marc; Maier-Rigaud, Frank; März, Oliver |
| Abstract: | We present a structural model to investigate the effects of horizontal cooperation on investment in the context of telecommunication networks. More specifically, we estimate the effect of network sharing in the mobile telecommunications industry on prices, network quality and consumer welfare. The presented framework allows estimating the effects of different types of sharing agreements including common ownership of shared assets in a joint venture company or collaboration via geographical separation (geo-split principle). The proposed identification strategy relies on differences in the costs of network deployment of shared versus non-shared network infrastructure, with different costs affecting operators' optimal choice of price and network quality. We apply the structural model to estimate the effects of a network sharing agreement in the Czech Republic, using a combination of unique datasets on prices, network quality measured as average download speed and operator's costs of network deployment. The results of our model indicate that horizontal cooperation on investments may be beneficial for consumers. Specifically, the network sharing agreement under study generated cost savings for the sharing parties, which were passed-on to consumers in the form of lower prices and higher average download speed. Our findings are of relevance to the assessment of network sharing agreements, which, considering the substantial investment cost associated with the 5G technology, are likely to play an even greater role in the telecommunications industry in the future. The findings are also of relevance to the general literature on horizontal cooperation on investments. |
| JEL: | L11 L40 L96 |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:14770&r=all |
| By: | Nino Antulov-Fantulin; Tian Guo; Fabrizio Lillo |
| Abstract: | We study the problem of the intraday short-term volume forecasting in cryptocurrency exchange markets. The predictions are built by using transaction and order book data from different markets where the exchange takes place. Methodologically, we propose a temporal mixture ensemble model, capable of adaptively exploiting, for the forecasting, different sources of data and providing a volume point estimate, as well as its uncertainty. We provide evidence of the outperformance of our model by comparing its outcomes with those obtained with different time series and machine learning methods. Finally, we discuss the difficulty of volume forecasting when large quantities are abruptly traded. |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2005.09356&r=all |
| By: | Wallbach, Sören; Lehner, Roland; Röthke, Konstantin; Elbert, Ralf; Benlian, Alexander |
| Date: | 2020–05–14 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:120705&r=all |
| By: | Désirée Rückert; Reinhilde Veugelers; Christoph Weiss |
| Abstract: | Using a new survey on digitalisation activities of firms in the EU and the US, we identify digitalisation profiles based on the current use of digital technologies and future investment plans in digitalisation. Our analysis confirms the trend toward digital polarisation and a growing digital divide in the corporate landscape with, on one side, many firms that are not digitally active, and on the other side, a substantial number of digitally active firms forging ahead. Old small firms, with less than 50 employees and more than 10 years old, are significantly more likely to be persistently digitally non-active. We show that these persistently non-digital firms are less likely to be innovative, increase employment or command higher mark-ups. These trends are likely to exacerbate the digital divide across firms in the EU and the US. |
| Keywords: | digital technology, investment, firm performance |
| Date: | 2020–05–18 |
| URL: | https://d.repec.org/n?u=RePEc:ete:msiper:654659&r=all |
| By: | Diego Rodríguez Rodríguez |
| Abstract: | En esta nota se ofrecen algunas estimaciones del potencial uso del teletrabajo en las CCAA españolas y un análisis preliminar de su posible incidencia sobre la evolución de la pandemia y su impacto por el empleo. En segundo lugar, se ofrecen algunas reflexiones sobre las prioridades de inversión en materia digital, pensando en la utilización de un posible fondo de recuperación europeo, cuyo diseño está actualmente en discusión. |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:fda:fdafen:2020-08&r=all |
| By: | Gamze Danisman (Faculty of Management, Kadir Has University, Istanbul, Turkey); Amine Tarazi (LAPE - Laboratoire d'Analyse et de Prospective Economique - GIO - Gouvernance des Institutions et des Organisations - UNILIM - Université de Limoges) |
| Abstract: | The Great Recession of 2007-2009 piqued the interest of policymakers worldwide, prompting various initiatives to stabilize the financial system and advance financial inclusion. However, few studies have considered their interconnectedness or whether any synergies or trade-offs exist between them. This paper investigates how financial inclusion affects the stability of the European banking system. The findings indicate that advancements in financial inclusion through more account ownership and digital payments have a stabilizing effect on the banking industry. A deeper investigation shows that such a stabilizing impact is mainly driven by the targeting of disadvantaged adults who are young, undereducated, unemployed, and who live in rural areas. Hence, along with its known benefits to society as a whole, financial inclusion has the additional benefit of improving the stability of the financial system. Such findings call for policy configurations that are specifically designed to achieve financial inclusion for disadvantaged individuals. |
| Keywords: | Financial Inclusion,Bank Stability,Account Ownership,Digital Payments,Disadvantaged Adults |
| Date: | 2020–05–26 |
| URL: | https://d.repec.org/n?u=RePEc:hal:wpaper:hal-02624355&r=all |
| By: | Sabrina T. Howell; Josh Lerner; Ramana Nanda; Richard R. Townsend |
| Abstract: | Although late-stage venture capital (VC) activity did not change dramatically in the first two months after the COVID-19 pandemic reached the U.S., early-stage VC activity declined by 38%. The particular sensitivity of early-stage VC investment to market conditions—which we show to be common across recessions spanning four decades from 1976 to 2017—raises questions about the pro-cyclicality of VC and its implications for innovation, especially in light of the common narrative that VC is relatively insulated from public markets. We find that the implications for innovation are not benign: innovation conducted by VC-backed firms in recessions is less highly cited, less original, less general, and less closely related to fundamental science. These effects are more pronounced for startups financed by early-stage venture funds. Given the important role that VC plays in financing breakthrough innovations in the economy, our findings have implications for the broader discussion on the nature of innovation across business cycles |
| JEL: | G24 O31 |
| Date: | 2020–05 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:27150&r=all |
| By: | John Goodell; Stéphane Goutte (LED - Laboratoire d'Economie Dionysien - UP8 - Université Paris 8 Vincennes-Saint-Denis) |
| Keywords: | Co-movement,COVID-19,Bitcoin,Wavelet,Safe haven |
| Date: | 2020–05–20 |
| URL: | https://d.repec.org/n?u=RePEc:hal:wpaper:halshs-02613277&r=all |
| By: | Sturm, Timo; Peters, Felix |
| Date: | 2020–06–15 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:120718&r=all |
| By: | Massimo Motta; Martin Peitz |
| Abstract: | Big tech mergers are frequently occurring events. What are the competitive effects of these mergers? With the help of a simple model we identify the acquisition of potential competitors as a pressing issue for merger control in digital industries. We also sketch a few novel theories of harm of horizontal and conglomerate mergers that are potentially relevant in digital industries. Finally, we draw some policy recommendations on how to deal with mergers in such industries. |
| Keywords: | merger policy, digital markets, potential competition, conglomerate mergers |
| JEL: | L41 L13 K21 |
| Date: | 2020–01 |
| URL: | https://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2020_147v1&r=all |