Essays on alternative finance

This thesis investigates two areas of alternative finance - fintech and real estate investment - and examines how technological innovations in payment systems and frictions in real estate markets influence firm behaviours, household decisions, and broader economic outcomes. Chapter 2 surveys the modern economics of payments, synthesises industrial organisation, new‑monetarist and quantitative strands of the literature, highlighting open questions around two‑sided pricing, merchant surcharging and consumer welfare. Chapter 3, Payment Wars in Retail, develops a stylised model to understand the rapid adoption of Buy‑Now‑Pay‑Later (BNPL) and how merchants choose among cash, credit cards and BNPL. BNPL combines vendor financing with fintech credit scoring, enabling merchants to practise third‑degree price discrimination and serve liquidity‑constrained, high‑risk consumers that card networks cannot profitably reach. The model predicts (i) low‑cost merchants are the first adopters of BNPL, (ii) equilibrium merchant pricing depends on the relative pass‑through of card and BNPL fees, and (iii) BNPL diffusion can raise total surplus yet transfer rents from card networks to merchants and fintech lenders. Chapter 4, Golden Visas and Real‑Estate Markets, provides the first causal evaluation of Spain’s 2013 golden visa programme. Using the universe of registrar transactions matched to buyer and seller nationality, a triple‑difference design and shift-share instruments help to alleviate endogeneity concerns, we show that transactions just above the 500,000 Euro eligibility threshold rose by 0.24 percentage points for non‑EU investors relative to EU buyers. Non‑EU purchasers paid an average premium of about 10,000 Euro, and the programme generated positive spillovers, lifting municipality‑level house prices by 0.45 percent. Collectively, the essays demonstrate how fintech credit and policy‑driven capital inflows reshape market outcomes, providing new evidence for regulators balancing innovation, financial inclusion and housing affordability.