A Structural Test of Mental Accounting and Consumer Fungibility From Credit Card Expenditures

We compare preferences for credit card versus debit card utilization for a variety of purchases. Using transaction-level data, we estimate that to compensate consumers for every $1 in debt-bearing credit card usage would require over $2 in cash subsidies. Thus, we reject the notion that consumer preferences exhibit rational fungibility.



Citation:

Nicholas Pretnar, Christopher Olivola, and Alan Montgomery (2019) ,"A Structural Test of Mental Accounting and Consumer Fungibility From Credit Card Expenditures", in NA - Advances in Consumer Research Volume 47, eds. Rajesh Bagchi, Lauren Block, and Leonard Lee, Duluth, MN : Association for Consumer Research, Pages: 232-236.

Authors

Nicholas Pretnar, Carnegie Mellon University, USA
Christopher Olivola, Carnegie Mellon University, USA
Alan Montgomery, Carnegie Mellon University, USA



Volume

NA - Advances in Consumer Research Volume 47 | 2019



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