Why are payment habits so heterogeneous across and within countries? Evidence from European countries and Italian regions

The aim of this work is to arrive at a better understanding of the underlying reasons for the slow adoption of electronic payment instruments in Italy. Our findings indicate that a pivotal role in explaining Italy�s lag in abandoning cash is played by development factors, such as innovative capability and income per capita. Surprisingly, although the shadow economy is important, it is not decisive in explaining the limited use of electronic retail payment instruments.