The Relationship between Competition and Market Concentration in the Banking Industry: Evidence from Asia and Central and South America

• Main Authors: Jain-Hong Lin, 林建宏
• Other Authors: Roung-Jen Wu
• Format: Others
• Language: zh-TW
• Published: 2008
• Online Access: http://ndltd.ncl.edu.tw/handle/19415957648944658950

碩士 === 雲林科技大學 === 財務金融系碩士班 === 96 === The main purpose of this study is to study the relationship between bank competition and market concentration. First, we use the non-structural Panzar-Rosse model to measure degree of bank competition. Further, we use a regression to investigate whether the market concentration and the other variables have effect one the bank competition or not. We use 7,956 bank-year observations in Asia and Center and South America during the period 1999 to 2006. It is desirable to mention that these countries must have at least twenty bank-year observations each year in the BANKSCOPE database to be selected in our sample. The result of measurement of bank competition shows that the banking industries in some countries are in monopolistic competition and those in other countries are in perfect competition or monopoly. The empirical evidence shows there exists a significantly positive relationship between market concentration and bank competition. Further, there exists a significantly negative relationship between restriction on bank activities and the bank competition. These evidences are the same with the findings by Claessens and Laeven(2004). This implies that it is important to consider inter-industry and macroeconomic variables in the model in order to study what factors really affect the bank competition.