Geoffrey Manne, Julian Morris, and Todd Zywicki Cited by CEI on the Durbin Amendment
In the OpenMarket blog from the Competitive Enterprise Institute, ICLE scholars Geoffrey Manne, Julian Morris, and Todd Zywicki were cited for their 2014 study on payment card price controls:
As I have noted previously, American consumers have paid the cost of Dodd-Frank’s Durbin Amendment both through reduced benefits, like free checking, and higher fees at their banks and credit unions.
In 2009, the year before Dodd-Frank was enacted, 76 percent of checking accounts were free of charge. By 2011, this share had fallen to 45 percent, and by 2012 to 39 percent, according to Bankrate.com. Service charges on non-interest bearing checking accounts have also increased dramatically. A 2014 George Mason University study conducted by scholars Todd Zywicki, Geoffrey Manne, and Julian Morris calculates that the Durbin Amendment contributed to 1 million Americans losing access to the banking system—becoming “unbanked”—by 2011.
And the savings on retail goods and services that retailers said would be passed on to consumers turned out to be miniscule or nonexistent. Even accounting for some lower prices in highly competitive markets, the public still suffered a net welfare loss of $22 to $25 billion—the amount lost (in free checking and imposition of new bank fees) that exceeded any gains from lower retail prices—according to a 2015 study published in the Journal of Competition Law and Economics.