Incompatibility, product attributes and consumer welfare
Subtitle: evidence from ATMs
By: Christopher R. Knittel, Victor Stango.
Contributors: Stango, Victor.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 10962; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 10962.
Publisher: National Bureau of Economic Research
Published: 2004
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Automated tellers.
Description: "Incompatibility in market with network effects reduces consumers' ability to "mix and match" components offered by different sellers, but can also spur changes in product attributes that might benefit consumers.  In this paper, we estimate the effects of incompatibility on consumers in a classic hardware/software market: ATM cards and machines.  We find that while ATM fees ceteris paribus reduce the network benefit from other banks' ATMs, a surge in ATM deployment accompanies the shift to surcharging.  This is valuable to consumers and often completely offsets the harm from higher fees.  The results suggest that policy discussions of incompatibility must consider not only its direct effect on consumers, but also its effect on product attributes"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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Mode of access: World Wide Web.