Price Dispersion on Payday Loan Market in Finland, a Descriptive Study

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dc.contributor Aalto-yliopisto fi
dc.contributor Aalto University en Mäenpää, Antti 2017-06-15T07:44:06Z 2017-06-15T07:44:06Z 2016
dc.description.abstract This thesis aims to enlighten, why there exists intense price dispersion on payday loans market in Finland, even though payday loans can be seen as a homogeneous goods. The dispersion is observed on one period between firms and is made apparent by calculating annual percentage rates for loans with different sizes and different payback times. After that the dispersion is first reflected against literature, that covers price dispersion in settings, where consumer is faced with search costs and when she suffers from biases, that lead to consistent failure in optimization. Due to the search cost consumers might search too little and this allows firms to charge higher than competitive prices, whereas behavioral issues expose consumers to pay too much, when they do not have realistic expectations for example on their future demand. Second, dispersion is covered in the light of credit screening literature, that suggests when firms screen out risky consumers based on different criterion, they naturally set rates to cover for the risk that they engage in. It is also showed, that the sales of firms are dispersed, which following the standard industrial organizations theory would suggest, that the firms do not have equal costs. Taking account Finnish collective labor agreements operational costs might be close to equal, but on the other hand the borrowing costs of firms might differ. en
dc.format.extent 57
dc.format.mimetype application/pdf en
dc.language.iso en en
dc.title Price Dispersion on Payday Loan Market in Finland, a Descriptive Study en
dc.type G2 Pro gradu, diplomityö fi Kauppakorkeakoulu fi School of Business en
dc.contributor.department Taloustieteen laitos fi
dc.contributor.department Department of Economics en
dc.subject.keyword behavioral economics
dc.subject.keyword käyttäytymisen taloustiede
dc.subject.keyword consumer credit
dc.subject.keyword kulutusluotot
dc.subject.keyword competition
dc.subject.keyword kilpailu
dc.subject.keyword credit
dc.subject.keyword luotto
dc.subject.keyword payday loan
dc.subject.keyword pikavippi
dc.subject.keyword markets
dc.subject.keyword markkinat
dc.subject.keyword microeconomics
dc.subject.keyword mikrotalous
dc.subject.keyword hintadispersio
dc.subject.keyword price dispersion
dc.identifier.urn URN:NBN:fi:aalto-201801181139
dc.type.dcmitype text en
dc.programme.major Kansantaloustiede fi
dc.programme.major Economics en
dc.type.ontasot Pro gradu tutkielma fi
dc.type.ontasot Master's thesis en
dc.subject.helecon taloustieteet
dc.subject.helecon rahoitusmarkkinat
dc.subject.helecon rahoitus
dc.subject.helecon lainat
dc.subject.helecon luotto
dc.subject.helecon hinnoittelu
dc.ethesisid 14783 2016-06-08
dc.location P1 I

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