Discussion%20of%20Schuh%20

1
Discussion ofSchuh Stavins

• Jon Zinman
• Dartmouth College
• 26 Oct 2007

2
Acknowledgement

• FRBBOS great provider of public goods re
  research on consumer payment choice
• Conferences
• AEA session

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Main Contribution

• Beyond Demographics
• Adding payment chars reduces sig of demos
• Adding payment chars dramatically increases fit
• Can do more
• Show regression results with just demos
• Tighten critique of what (little) we learn from
  demo correls
• High-frequency, not life-cycle, choice here
• Economic and policy modeling need primitives

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Tweaks to Existing Setup

• Motivation
• Paper is primarily interested in whats driving
  declining check volume
• Dont we know that action is on intensive margin?
  (85 of SCF hhs had checking account in 1995 89
  in 2004)
• Conclusion says that many hhs have not reduced
  check use
• Sounds plausible, but whats data source?

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Tweaks to Existing Setup

• Econometric implementation more outcomes?
• Intensive margin why is share right outcome
  variable?
• Skewed?
• Denominator endogenous?
• Try some specs with level or log, conditional on
  income and other proxies for total spending?
• Rejection (hazard out) on extensive margin?
• Any data on this?
• Interesting re response to low prob. events
  (fraud)
• Interesting re spending control on credit cards?

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Tweaks to Existing Setup

• Econometric Implementation
• Reorganize/reclassify payment characteristics to
  provide tighter links to model based on
  primitives?
• Show survey questions
• Whats in cost? (fixed, marginal, overdraft
  risk.?)
• Whats in convenience (time cost? Portability?)
• Where is acceptance?

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Tweaks to Existing Setup

• Representativeness issue
• Get old data from consulting/market research
  firms, and compare?

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Tweaks to Existing Setup

• Exposition/interpretation
• Showing that perceived attributes correlate with
  choices sensible, but.
• Acknowledge possible justification bias

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Blue Sky for Future Surveys

• Issues with existing survey data
• Too heavy on introspection (vs. revealed
  preference). Worried about
• Noise
• Justification bias
• Not enough latitude for heterogeneity in payment
  chars
• over time (even at high frequencies)
• Credit revolving status
• Overdraft risk
• across transaction types
• Cash back
• POS vs. billpay

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Blue Sky

• Solutions for future surveys
• Ask about recent transactions
• Whats not whys
• Including acceptance
• Compare this elicitation method to subjective
  attribute perceptions would be nice
  methodological contribution
• Could also tweak subjective questions to allow
  for heterogeneity in payment chars
• Do ever find media most attribute/char?
• How often?

11
Blue Sky

• Exercise for future surveys
• Whats in the 70 unexplained variation?
• How can we collect data on these factors?