Paying with Plastic - Summary and Key Ideas

"Paying with Plastic" is a comprehensive exploration of the credit card industry, detailing its history, economics, and the impact it has on society.

The target group for the book "Paying with Plastic" is likely individuals interested in economics, finance, and the history and impact of credit card usage.

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Paying with Plastic

Key ideas


The payment card industry, born from innovations like coins, checks, and paper money, has evolved into a global powerhouse.


The fragmented banking system, led to the widespread use of checks paving the way for the evolution of credit cards.

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Incremental innovations, co-opetition, and overcoming challenges made cards more appealing and ubiquitous.

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Payment cards have revolutionized financial management, offering convenience, a consistent lifestyle, and supporting entrepreneurship.

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The acceptance of payment cards is a complex balance of merchant competition, consumer preference, and cost management.

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Multisided platform economics, balancing the needs of different customer groups through strategic pricing, is pivotal to the evolution and competition within industries like the payment card sector.

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There are co-opetitive systems like Visa and Mastercard, which foster innovation through cooperation, and go-it-alone systems like American Express, which offer rapid response but risk strategic errors.

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The competition among major payment card systems shapes the financial industry through strategic pricing, advertising, and policy changes.

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The competition from various issuers benefits consumers through decreased prices and increased options.

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The payment card industry has transformed from bank-led operations to domination by specialist firms, leading to increased competition and lower processing prices for consumers.

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Antitrust battles have significantly shaped the payment card industry, with disputes ranging from membership rules to interchange fees and merchant discounts.

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Emerging technologies, legal battles, and new entrants are poised to revolutionize the payment card industry, potentially disrupting its traditional structure.

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Summary & Review

"Paying with Plastic" by David S. Evans and Richard Schmalensee provides an in-depth analysis of the credit card industry, its history, and its impact on the global economy. The authors delve into the complexities of the industry, discussing the intricate network of banks, merchants, and consumers that make up the credit card system. They also explore the economic and social implications of credit card use, including the role of credit cards in consumer debt and the potential for fraud and security breaches. The book offers a comprehensive understanding of the credit card industry and its significant role in the modern economy.

David S. Evans, Richard Schmalensee

David S. Evans is an economist, business advisor, and entrepreneur, known for his work on the "new economy" and digital markets. Richard Schmalensee is a renowned economist and professor, recognized for his contributions to industrial organization economics and environmental economics.

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