Working Paper
The welfare consequences of ATM surcharges: evidence from a structural entry model
Gowrisankaran, Gautam; Krainer, John (2004)
We estimate a structural model of the market for automatic teller machines (ATMs) in order to evaluate the implications of regulating ATM surcharges on ATM entry and consumer and producer surplus. We estimate the model using data on firm and consumer locations, and identify the parameters of the model by exploiting a source of local quasi?experimental variation, that the state of Iowa banned ATM surcharges during our sample period while the state of Minnesota did not. We develop new econometric methods that allow us to estimate the parameters of equilibrium models without computing ...
Working Paper Series , Paper 2005-01

Working Paper
Network externalities and technology adoption: lessons from electronic payments
Stavins, Joanna; Gowrisankaran, Gautam (1999)
We seek to determine the presence and causes of network externalities for the automated clearinghouse (ACH) electronic payments system, using a monthly panel data set on individual bank adoption of ACH. We construct a model of ACH usage that shows how to separately identify network externalities from technological advancement and peer-group effects. We find significant evidence of network effects and find evidence that these network effects are not internalized. Moreover, a large part of these network effects is due to informational problems. Sunk costs of adoption appear to be low.
Working Papers , Paper 99-5

Working Paper
Learning and the value of information: the case of health plan report cards
Gowrisankaran, Gautam; Scanlon, Dennis P.; Chernew, Michael (2002)
We estimate a Bayesian learning model in order to assess the value of health plan performance information and the extent to which the explicit provision of information about product quality alters consumer behavior. We take advantage of a natural experiment in which health plan performance information for HMOs was released to employees of a Fortune 50 company for the first time. Our empirical work indicates that the release of information had a small but statistically significant effect on health plan choices, causing 3.1% of employees to switch health plans. Although consumers were willing ...
Working Paper Series , Paper 2002-17

Journal Article
Bank ATMs and ATM surcharges
Krainer, John; Gowrisankaran, Gautam (2005)
The proliferation of ATMs and the pricing schemes that accompany them have attracted a great deal of attention from research economists, because they shed light on how banks compete against each other in the current environment. By studying the pattern of entry of ATMs in certain markets we can gain insight into the potential welfare consequences of the lifting of artificial price controls. This Economic Letter reports on recent research on bank ATMs and ATM surcharges.
FRBSF Economic Letter

Working Paper
Network externalities and technology adoption: lessons from electronic payments
Stavins, Joanna; Gowrisankaran, Gautam (2002)
We seek to analyze the extent and sources of network externalities for the automated clearinghouse (ACH) electronic payments system using a quarterly panel data set on individual bank adoption and usage of ACH. We provide three methods to identify network externalities using this panel data. The first method identifies network externalities from the clustering of ACH adoption. The second method identifies them by examining whether banks in areas with higher market concentration or larger competitors are more likely to adopt ACH. The third method identifies them by examining whether the ACH ...
Working Paper Series , Paper 2002-16

Journal Article
Why do Americans still write checks?
Gowrisankaran, Gautam (2002)
FRBSF Economic Letter

Journal Article
Competition and regulation in the airline industry
Gowrisankaran, Gautam (2002)
FRBSF Economic Letter

Conference Paper
Are there network externalities in electronic payments?
Stavins, Joanna; Gowrisankaran, Gautam (1999)
Proceedings , Paper 652

Report
Do mergers lead to monopoly in the long run? Results from the dominant firm model
Holmes, Thomas J.; Gowrisankaran, Gautam (2000)
Will an industry with no antitrust policy converge to monopoly, competition or somewhere in between? We analyze this question using a dynamic dominant firm model with rational agents, endogenous mergers and constant returns to scale production. We find that perfect competition and monopoly are always steady states of this model and that there may be other steady states with a dominant firm and a fringe co-existing. Mergers are likely only when supply is inelastic or demand is elastic, suggesting that the ability of a dominant firm to raise price through monopolization is limited. ...
Staff Report , Paper 264

Journal Article
Productivity in heart attack treatments
Gowrisankaran, Gautam (2002)
FRBSF Economic Letter