U.S. Consumer Holdings and Use of $1 Bills

20 Pages Posted: 18 Oct 2015

See all articles by Scott Fulford

Scott Fulford

Consumer Financial Protection Bureau

Claire Greene

Federal Reserve Banks - Federal Reserve Bank of Atlanta

William Murdock

Harvard University

Date Written: January 1, 2015

Abstract

Small denominations play a special role in a payments ecosystem because they facilitate exchange for small-value goods and services. This report examines the $1 bill holdings of adults in the United States using data from the Diary of Consumer Payments Choice (DCPC). Simply knowing the number of $1 bills in circulation is not useful for understanding consumers' actions, since many of these bills are held by merchants. The costs and benefits to the consumer of carrying $1 bills have been largely ignored in the policy discussion of the costs of switching from dollar notes to dollar coins. Knowing the facts about U.S. adult consumers' holdings of $1 bills represents a first step toward gaining an understanding of these costs and benefits to consumers.

Keywords: money demand, currency denominations, $1 bill, Diary of Consumer Payment Choice

JEL Classification: D14, E14

Suggested Citation

Fulford, Scott and Greene, Claire and Murdock, William, U.S. Consumer Holdings and Use of $1 Bills (January 1, 2015). FRB of Boston Research Data Report No. 15-1, Available at SSRN: https://ssrn.com/abstract=2675333 or http://dx.doi.org/10.2139/ssrn.2675333

Scott Fulford

Consumer Financial Protection Bureau ( email )

United States

Claire Greene (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of Atlanta ( email )

1000 Peachtree Street N.E.
Atlanta, GA 30309-4470
United States

William Murdock

Harvard University ( email )

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