1. 28 Jul



    Credit Cards Take From Poor, Give to the Rich - Real Time Economics - WSJ

    mikehudack:

    squashed:

    robot-heart-politics:

    abbyjean:

    A new paper from the Federal Reserve Bank of Boston says merchant fees and reward programs offered by many credit-card issuers essentially take money from those who have the least and give it to those who have the most. The imbalance may have to be remedied via government intervention, the authors, Scott Schuh, Oz Shy and Joana Stavins, argued. The paper was published as part of the bank’s Public Policy Discussion Papers on Monday. The paper said that on average, households that use cash for purchases give $151 to those households that use credit cards annually. Meanwhile, card-using households get $1,482 from those who pay cash. The paper calls this a “regressive transfer” of wealth.

    I call it market economics.

    Regressive market economics.

     
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    Interesting, but not too surprising.
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    Regressive market economics.
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    And therefore, an illustration of some of the limits of free-market economic theory, and of the need for government...
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  28. mikehudack reblogged this from squashed and added:
    I call it market economics.
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    I worked for a financial institution as an undergrad for most of my college career and I can state that the same method...
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