A Note on the Aggregation of Payment Decisions

20 Pages Posted: 21 Jun 2007

See all articles by David Bounie

David Bounie

Télécom Paris

Nicolas Houy

University of Cergy-Pontoise - THEMA


In this note, we study, test and discuss two original classes of payment aggregation rules based on transaction size models in order to replicate the demand for cash and deposits in the economy. First, we show that some of the aggregation rules call for special consideration since they better replicate the observed demand for cash and deposits. Second, we put forward a counterintuitive result which states that considering the difference between the use of payment card and check can significantly improve the prediction of the demand for cash.

Keywords: Demand for money, Payment Instruments, Forecasting and Simulations

JEL Classification: E41, E17, G2

Suggested Citation

Bounie, David and Houy, Nicolas, A Note on the Aggregation of Payment Decisions. Available at SSRN: https://ssrn.com/abstract=995746 or http://dx.doi.org/10.2139/ssrn.995746

David Bounie

Télécom Paris ( email )

19 Place Marguerite Perey
Palaiseau, 91120

Nicolas Houy (Contact Author)

University of Cergy-Pontoise - THEMA ( email )

33 boulevard du port
F-95011 Cergy-Pontoise Cedex, 95011

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