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The Myth of Credit Card Competition

Reposted

Noah Rosenblum @narosenblum.bsky.social · 7d

It just cannot be emphasized enough, as the differential treatment of Slaughter and Cook illustrate yet again, the Roberts Court’s vision of separation of powers is not the Founders’, nor the Constitution’s, but just their own. This isn’t necessarily bad; it’s just disingenuous. (1/2)

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bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

Paper is here: papers.ssrn.com/sol3/papers.....

Relatedly, I'm on the law school job market (for financial institutions, business ass'ns, contracts, regulated industries, and communications law). Would appreciate your help to spread the word (especially if you enjoyed the paper)! 8/8

<p>You pay an invisible tax every time you swipe your credit card to pay—whether to buy groceries, grab a coffee, or access transportation. Credit card co

papers.ssrn.com

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

Instead, I argue that a more promising approach is to regulate swipe fees. Payment networks are vital economic infrastructure, and we should treat them as such. Rate regulation is also not novel. We've done it before with debit cards (Durbin Amendment) and checks. 7/8

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

And merchants are heavily incentivized to bear these fees (rather than surcharge consumers or only accept lower-fee cards). Today, many people use high-fee cards and expect them to be accepted. Merchants don't want to dissuade those card users from spending at their stores. 6/8

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

Credit card networks are engaged in a rewards rat race (cash back, airline miles, and lounge access, oh my!). To attract more cardholders to use their cards over others’ cards, networks are incentivized to raise swipe fees to fund more rewards. 5/8

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

The "myth" is that more competition (e.g., surcharging, more networks, multi-routing) will reduce prices and regressivity. Many blame the legal doctrine for these solutions' inefficacy to date. But I argue the problem is more fundamental: More competition likely won't work. 4/8

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

In 2024, U.S. businesses paid $148bn in 💳swipe fees (on the same order of magnitude as Trump's additional tariff revenues👀). These fees are much higher than the cost of service and disproportionately borne by lower-income consumers and smaller merchants. 3/8

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

Every time you swipe your credit card to pay—whether to buy groceries, grab a coffee, or hail an uber—you pay a small, invisible tax called a "swipe fee." This fee is charged to the merchant, who in turn raises its prices to recover these fees. 2/8

bendinovelli.bsky.social @bendinovelli.bsky.social · Sep 3

Excited to share that my job talk paper, The Myth of Credit Card Competition, is forthcoming in Vanderbilt Law Review!

I explore the limits of competition (through antitrust, consumer law, or regulation) as a solution to high and regressive swipe fees in the credit card payments market. 1/8

Trump’s Plan to Pack the Fed With Loyalists

Reposted

graham steele @grahamsteele.bsky.social · Sep 1

Some were sanguine that the Fed’s structure meant the Fed system could remain independent even if Trump gained control of the Board.

But this excellent piece shows how far Trump and his allies could go.

These scenarios would have been unthinkable a few months ago.
www.nytimes.com/2025/08/31/b...

www.nytimes.com

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Reposted

Just Money @justmoney.bsky.social · Aug 27

📢More scholarship! @bendinovelli.bsky.social's timely paper revisits the Federal Reserve's ostensibly unique status among administrative agencies. It examines SCOTUS' attempt to except the Fed from case law limiting agency independence, with implications for Fed Governors' legal removal protections.

Current ScholarshipThe Federal Reserve Exception

Benjamin Dinovelli

justmoney.org

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bendinovelli.bsky.social @bendinovelli.bsky.social · Aug 28

Thank you for the shout out!

The Federal Reserve Exception

Reposted

Josh Chafetz @joshchafetz.bsky.social · Aug 26

1/2 Trump should absolutely not be able to fire Lisa Cook.

But this is because he should not be able to fire anyone with statutory tenure protections.

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Reposted

bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 4

I wrote about the Supreme Court's recent attempt to protect the Federal Reserve's independence from the Trump Administration. 1/8

papers.ssrn.com/sol3/papers....

<p>The Federal Reserve is arguably the most powerful administrative agency that has ever existed in the United States. Its administrative actions influenc

papers.ssrn.com

The Federal Reserve Exception

Reposted

Pat Sobkowski @patsobkowski.com · Jun 28

Similar to Alan, my parents adopted me from South Korea when I was a baby. I have no recollection of Seoul or my biological mother. I also do not know her name or have any details.

To echo: if birthright citizenship becomes a patchwork right, what’s someone like me to do?

Alan Elrod @aselrod.bsky.social · Jun 27

I was adopted via closed adoption, born in North Carolina.

It was closed so I have no knowledge of or access to my biological mother’s details. It also means my biological mother isn’t on my birth certificate.

So if birthright citizenship becomes a patchwork right, what’s someone like me to do?

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bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 26

This appears to be the latest text (according to Punchbowl): www.commerce.senate.gov/services/fil...

www.commerce.senate.gov

Reposted

William Weightman @weightman.bsky.social · Jun 23

🚨 Very excited to share that my note, Municipalities and the Banking Franchise, is officially out in the @stanlrev.bsky.social! The piece explores the role local governments can play in building a more democratic financial system. papers.ssrn.com/sol3/papers.... 1/10

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Reposted

Brian Highsmith @bhighsmith.bsky.social · Jun 16

The final version of my job market paper—about the strategies that have facilitated localized corporate domination at different points in our history—is now out. I'm so grateful to the SLR team and everyone else whose feedback has shaped this along the way! www.stanfordlawreview.org/print/articl...

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bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 12

If you're curious about why we shouldn't take too much comfort from the Court's "bespoke Federal Reserve exception" in Trump v. Wilcox, you can read more here:

papers.ssrn.com/sol3/papers....

<p>The Federal Reserve is arguably the most powerful administrative agency that has ever existed in the United States. Its administrative actions influenc

papers.ssrn.com

Donald Trump says he may ‘have to force something’ on interest rates

bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 12

But I thought the Fed was “a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States”...?

Financial Times @financialtimes.com · Jun 12

Donald Trump says he may ‘have to force something’ on interest rates

https://www.ft.com/content/87a2c699-be5b-4a3b-9ae1-db3e997633af

President calls Federal Reserve chair Jay Powell a ‘numbskull’ for not reducing borrowing costs

www.ft.com

bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 12

Ty and yes! Recognize the term “abundance” is broad and means diff things to diff ppl. But to your point, (at least w/r/t broadband) the debate felt myopically focused on “procedural barriers” for subsidies (and debating if duped dems, rapacious reps, corrupt capitalists, or a mix were responsible)

bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 11

Thank you for reading / highly recommending my piece, @lsolum.bsky.social!

Lawrence Solum @lsolum.bsky.social · Jun 11

Dinovelli on the Federal Reserve and Removal, buff.ly/iort3UT - Benjamin Dinovelli (Vanderbilt Law School) has posted The Federal Reserve Exception on SSRN.

buff.ly

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bendinovelli.bsky.social @bendinovelli.bsky.social · Jun 10

Thank you for the very kind words! And kudos are owed to @giladedelman.bsky.social (who was extremely helpful in making our ideas sharper and stronger)