Heng Chen

Principal Researcher

Heng Chen is a Principal Researcher in the Currency Department at the Bank of Canada. His primary research interests center on the structural identification and estimation of the causal effects of the method of payments on the cash usage. Specific topics include distributional estimations using the longitudinal CFM data. Heng Chen received his PhD in economics from Vanderbilt University.


Heng Chen

Principal Researcher
Economic Research and Analysis

Bank of Canada
234 Wellington Street
Ottawa, ON, K1A 0G9


Cash Versus Card: Payment Discontinuities and the Burden of Holding Coins

Staff Working Paper 2017-47 Heng Chen, Kim Huynh, Oz Shy
Cash is the preferred method of payment for small value transactions generally less than $25. We provide insight to this finding with a new theoretical model that characterizes and compares consumers’ costs of paying with cash to paying with cards for each transaction.

The Mode is the Message: Using Predata as Exclusion Restrictions to Evaluate Survey Design

Staff Working Paper 2017-43 Heng Chen, Geoffrey R. Dunbar, Rallye Shen
Changes in survey mode (e.g., online, offline) may influence the values of survey responses, and may be particularly problematic when comparing repeated cross-sectional surveys.
Content Type(s): Staff Research, Staff Working Papers Topic(s): Econometric and statistical methods JEL Code(s): C, C8

The Bank of Canada 2015 Retailer Survey on the Cost of Payment Methods: Calibration for Single-Location Retailers

Technical Report No. 109 Heng Chen, Rallye Shen
Calibrated weights are created to (a) reduce the nonresponse bias; (b) reduce the coverage error; and (c) make the weighted estimates from the sample consistent with the target population in terms of certain key variables.

The Costs of Point-of-Sale Payments in Canada

Using data from our 2014 cost-of-payments survey, we calculate resource costs for cash, debit cards and credit cards. For each payment method, we examine the total cost incurred by consumers, retailers, financial institutions and infrastructures, the Royal Canadian Mint and the Bank of Canada.

Variance Estimation for Survey-Weighted Data Using Bootstrap Resampling Methods: 2013 Methods-of-Payment Survey Questionnaire

Technical Report No. 104 Heng Chen, Rallye Shen
Sampling units for the 2013 Methods-of-Payment Survey were selected through an approximate stratified random sampling design. To compensate for non-response and non-coverage, the observations are weighted through a raking procedure.
Content Type(s): Technical Reports Topic(s): Econometric and statistical methods JEL Code(s): C, C8, C83

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Refereed journals

  • “A Flexible Parametric Approach for Estimating Switching Regime Models and Treatment Effect Parameters”
    (with Yanqin Fan and Jisong Wu), Journal of Econometrics, 181(2), 77-91, 2014.
  • Sheep in Wolf's Clothing: Using the Least Squares Criterion for Quantile Regression
    Economics Letters, Volume 125, Issue 3, Pages 426–431, December 2014.
  • “Retail Payment Innovations and Cash Usage: Accounting for Attrition Using Refreshment Samples”
    (with Marie-Helene Felt and Kim Huynh), Journal of Royal Statistical Society: Series A, 2016.
  • “Measuring Consumer Cash Holdings: Lessons from the 2013 Bank of Canada Methods-of-Payment Survey”
    (with Chris Henry, Kim Huynh, Rallye Shen, Kyle Vincent), Survey Practice, 9(4), 2016.
  • “Inference for the Correlation Coefficient between Potential Outcomes in the Gaussian Switching Regime Model”
    (with Yanqin Fan and Ruixuan Liu), Journal of Econometrics, 195(2), 255-270, 2016.

Work in Progress

  • “Within-group Estimators for Fixed Effects Quantile Models with Large N and Large T”.
  • “Set Identification and Estimation of Dynamic Quantile Models from Repeated Cross-Sections”.
  • “Identification and Wavelet Estimation of LATE in a Class of Switching Regime Models”.
    (with Yanqin Fan), R&R at Journal of Econometrics.
  • “Local Polynomial Wavelet Estimation of the Local Average Treatment Effect”.


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