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November/December 1995, 
Vol. 77, No. 6
Posted 1995-11-01

Payment Systems and Antitrust: Can the Opportunities for Network Competition be Recognized?

by David A. Balto

The author notes that a series of ATM network mergers have resulted in virtual monopolies of ATM systems within large regions of the country. He interprets the actions of the antitrust authorities (including the Federal Reserve in its role of approving acquisitions by bank holding companies) as reflecting the view that regional ATM networks have characteristics of natural monopolies. He challenges the view that regional ATM networks are natural monopolies and argues for the benefits of preserving network competition. He cites cases of vigorous competition between ATM networks that ceased when networks merged.





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