The New York City Smart Card Trial in Perspective: A Research Note

Abstract

The adoption of smart cards continues to be more interesting to those who market them than to the target population. A high-profile test of Mondex and Visa Cash stored-value cards ended in 1998 after a 15-month run on Manhattan's Upper West Side. The results were disappointing. This paper describes the organization of the trial, analyzes the results, and offers possible explanations for the low consumer and merchant acceptance. These explanations are integrated with prior analyses into a coherent theoretical framework combining insights from the literature on network externalities and innovation diffusion.

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