Seminar Topic: We intend to extend the literature on disruptive innovation by examining diferent dimensionsof demand complementarity that can be exploited by the incumbents and disruptiveentrants through their respective business models. We leverage the addition of a bus linein Manhattan, New York City, that inadvertently extended the reach of subway commutersfrom Brooklyn neighborhoods with a large unbanked population and a high FinTechadoption rate to neighborhoods in Manhattan. We find that the addition of the bus lineincreased the numbers of commuters from Brooklyn to the treated Manhattan neighborhoods(those near the new bus stops or those that experienced a reduction in travel time fromBrooklyn). In addition, restaurants in treated Manhattan neighborhoods saw an increasein their customers using person-to-person (P2P) payment apps (e.g., PayPal), whereaslocal bank branches experienced a decrease in the number of visits. The decrease inbank visits was less for (1) bank branches that offered a broader scope of retail bankingservices, and (2) branches of banks that had preemptively provided offerings withnetwork effects (e.g., those that had joined the Zelle platform).

Time and Location: April 29, 2025 | 9:30-11:00 (GMT+8), Room A823 (School of Management)

Language: Bilingual (English & Chinese)