terminals that accept a particular card greatly affect the utility of the user. the larger the number of payment terminals that a bank can install, the happier will be the users and the larger the share of the card payment market the bank will have. economies of scale and network effects both increase the incentives for co - operation between card issuers in establishing common standards and communication between systems. in sweden and in the other nordic countries as well, banks have a long tradition of cooperation in using common infrastructure and implementing common standards, perhaps more so than in many other regions. this is likely to have contributed to the rapid expansion of the card payment market in the nordic countries. there are some country specific differences, though. as should be expected, the number of payments per capita increases with the number of terminals installed ( fig 8 ). at least for sweden, there seems to be remaining positive network effects that may further expand the market. see for example humphrey, pulley and vesala ( 1996 ) : " cash, paper, and electronic payments : a cross - country analysis ", journal of money, credit, and banking, nov. this is an econometric study of different factors affecting the choice of payment instruments. the price coefficient had no statistical significance in this study. however the data set was poor. this result was later revised in the norwegian study : humphrey, kim and vale ( 1998 ) : realizing the gains from electronic payments : costs, pricing and payment choice, norges bank. consideration of risk risk considerations are always important in card transactions. consumers in countries where criminality is low, such as switzerland and japan ( and sweden for that matter ), tend to favour cash payments to a larger extent than in countries, where the risks of carrying large amounts of cash are higher. problems in the handling of risk are also likely to be behind the disappointing development of e - commerce. the evolution of a digital market is believed to have been partly hindered by the lack of sufficiently secure payment instruments. for card issuers and banks matters of security are crucially important. there is, as always, a trade off between risk and the cost of avoiding risk by adopting security enhancing technology. when technology becomes less costly, more of it will be used. e - commerce is likely to benefit from that development. incentives to reduce risks are important and drive the current technological developments in the market. costs for fraud are very high. moreover, these costs are increasing in most countries. although card frauds are relatively less

villy bergstrom : should the riksbank be concerned about asset prices? speech by mr villy bergstrom, deputy governor of the sveriges riksbank, at a breakfast meeting arranged by round table in sundsvall, on 11 april 2000. * * * the swedish economy is growing more quickly than for a very long time. in 1999, gdp increased by 3. 8 % and during the coming three years, growth is expected to average almost 3. 5 %. at the same time, the prerequisites for a long - term favourable development appear better than for many decades. almost all economic indicators are pointing in the right direction. despite a very strong upswing, the long - term inflation expectations remain stable and close to the target for monetary policy. central government finances are in surplus for the second year running and despite a planned tax reduction of over sek10 billion this year, the surplus in the central government budget is expected to total at least 2 % of gdp. from having had the next poorest budget balance in the entire eu in the early 1990s, the budget balance in our public finances is now among the strongest in the whole union. since the mid - 1990s, central government debt has decreased from 80 to 70 % of gdp. our country ’ s financial balance, ie the current account, has at the same time shown a surplus for a number of years and the foreign debt has fallen from 40 to 20 % of gdp during this period. however, unemployment is still too high - the increase in production of almost 15 % since the end of the 1980s has not been sufficient to bring the labour market into balance. the employment ratio has increased, however, from 72 to 74 % during the past year and employment is expected to increase greatly during the coming years. it is expected that open employment will fall to 3. 7 % in 2002. however, the beginning of this decade looks very promising. almost the entire 1990s were marked by the problems in the wake of the high inflation economy of the 1980s and the overheating that ended that decade. loan - financed consumption, excess investment, among other things, in properties, which took place in tandem with the increasing asset and property prices, had led to large financial and real imbalances being built up. when the bubble burst and the krona fell, there was a great need among households, businesses and banks to review their balance sheets and reduce their debt. as we know, this led to a great