Popular myths regarding the use of payment gateway for school
Investment in ICT increases the amount of physical capital, resulting in increased domestic output across the economy. E-business also makes labor and the production process itself more efficient, which will result in long run economic growth.
Published on: Mar 4, 2016
Transcripts - Popular myths regarding the use of payment gateway for school
Popular Myths Regarding the Use of payment gateway for school
ICT lowers the cost of transferring, storing, and processing information. Accordingly, firms have
embraced B2B e-commerce to lower procurement costs. Cost reductions can be significant. Varian,
et al. (2002) report cost savings over 1998-2001of $164 billion to US firms from adoption of e-
business, and estimate that B2B e-commerce reduces input costs by 4-5 percent across all industry
categories. Lower costs for firms result in lower prices for final goods and services. E-commerce also
widens markets by removing geographical boundaries, bringing greater numbers of firms into
competition with each other and lowering prices. The broadening of markets and the lowering of
search costs for consumers forces both online and "brick and mortar" stores to lower prices
There is consensus among empirical studies that the growth in e-business lowers price levels. Find
that B2B transactions of payment gateway for college reduce the overall price level by 3.4 percent,
although they revise the estimated long-term impact to 0.5 percent in a later study similarly;
attribute a portion of the decline in the price of core commodities and services in last twenty years
to the adoption of e-business technologies. Even if the effects of e-business on the overall price
level are permanent, the main impact on the rate of inflation may last only while the cost
reductions work their way through the economy.
In the long term, however, e-business may not affect inflation much unless costs continue to fall at
similar rates. Also, firms and consumers will adjust their behavior to account for the presence of e-
business (when it becomes just "business"), at which point one would not expect further cost-
savings from competition.
Lower costs are only one way e-business may lower the aggregate price level. Since e-firms have
lower menu costs (the costs of changing prices) than offline stores, their prices should be less rigid
and they should adjust prices more often. Thus, B2C and B2B e-commerce lessens price rigidity,
causing unexpected, temporary cost shocks to have a lesser or shorter lasting effect on price levels
confirms that online bookstores have more flexible pricing than offline establishments. Other, more
recent economic studies find that considerable price rigidity still exists among e-firms, however.
Unlike one-time cost savings from adopting e-business of payment gateway for school, decreased
menu costs can continue to alter the way adverse cost shocks are promulgated to prices on an
ongoing basis, setting up persistent deflationary pressures.
The final way e-business affects inflation is by providing cash substitutes such as e-payments.
Suggest that one reason worldwide inflation was low in the 1990s was that the widespread use of
interest-bearing cash substitutes required central banks to exercise more monetary discipline. In
their theoretical model, competition between the central bank and the suppliers of inside money
reduces the temptation to depreciate the currency. When consumers can switch to inside money
(e-payments, e-money, etc.), the government knows it will lose future seignior age revenue and the
incentive to inflate is lessened.