RDP 2012-03: ATM Fees, Pricing and Consumer Behaviour: An Analysis of ATM Network Reform in Australia Appendix B: Definitions

Clare Noone

August 2012 – ISSN 1320-7229 (Print), ISSN 1448-5109 (Online)

l* Circumference of city
l Distance between ATMs
M Number of ATMs deployed by each bank in the two-bank case
M′ Numbers of ATMs deployed by each bank in the three-bank case
N Number of consumers
Ni Number of consumers with deposit accounts at bank i
Fi Account-keeping fee charged by bank i
τ Interchange fee
σi Direct fee charged by bank i
fi Foreign fee charged by bank i
di Distance a customer of bank i is from an own-bank ATM
x Customer's gross utility from making an ATM withdrawal
uO Customer's utility from making an own-bank ATM withdrawal net of travelling costs
uF Customer's utility from making a foreign ATM withdrawal net of travelling costs
ei Consumer's distance in taste from bank i offering of general services
si Quantity of general services offered by bank i
Ui(ej) Total expected utility of a customer with taste parameter ej from having an account with bank i
c Common ATM usage cost
m Own-bank processing cost
ρij Proportion of bank i customers who use a bank j ATM
πi Profit of bank i