Market Structure and the Banking Sector

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Market Structure and the Banking Sector

Author Info

Pere Gomis-Porqueras () (University of Miami)
Benoit Julien () (Uastralian Graduate School of Management, School of Economics, and CAER)

Additional information is available for the following registered author(s):

Abstract

We propose a simple framework to explore how different market structures in the banking system affect credit allocation, and how deposits and number of entrepreneurs affect the equilibrium number of banks in the economy. We find that within the Marshallian aggregate surplus perspective, the number of entrants in the banking system is always larger than the socially optimal number of banks.

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Publisher Info
Article provided by Economics Bulletin in its journal Economics Bulletin.

Volume (Year): 4 (2007)
Issue (Month): 24 ()
Pages: 1-9
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Handle: RePEc:ebl:ecbull:v:4:y:2007:i:24:p:1-9

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Find related papers by JEL classification:
D4 - Microeconomics - - Market Structure and Pricing
G2 - Financial Economics - - Financial Institutions and Services

References listed on IDEAS
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Shaffer, Sherrill, 1998. "The Winner's Curse in Banking," Journal of Financial Intermediation, Elsevier, vol. 7(4), pages 359-392, October. [Downloadable!] (restricted)
Other versions:
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Kenneth Burdett & Shouyong Shi & Randall Wright, 2001. "Pricing and Matching with Frictions," Journal of Political Economy, University of Chicago Press, vol. 109(5), pages 1060-1085, October. [Downloadable!] (restricted)
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Other versions:
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Other versions:
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Benoit Julien & John Kennes & Ian King, 2000. "Bidding for Labor," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 3(4), pages 619-649, October. [Downloadable!] (restricted)
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- Julien, B. & Kennes, J. & King, I., 1998. "Bidding for Labour," Discussion Papers dp98-03, Department of Economics, Simon Fraser University.
Nicola Cetorelli, 1997. "The role of credit market competition on lending strategies and on capital accumulation," Working Paper Series, Issues in Financial Regulation WP-97-14, Federal Reserve Bank of Chicago. [Downloadable!]
Scott Freeman, 1986. "Inside Money, Monetary Contractions, and Welfare," Canadian Journal of Economics, Canadian Economics Association, vol. 19(1), pages 87-98, February. [Downloadable!] (restricted)
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Smith, R Todd, 1998. "Banking Competition and Macroeconomic Performance," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 30(4), pages 793-815, November.
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- Bencivenga, V.R. & Smith, B.D., 1988. "Financial Intermediation And Endogenous Growth," RCER Working Papers 124, University of Rochester - Center for Economic Research (RCER).
Williamson, Stephen D., 1986. "Costly monitoring, financial intermediation, and equilibrium credit rationing," Journal of Monetary Economics, Elsevier, vol. 18(2), pages 159-179, September. [Downloadable!] (restricted)
Other versions:
- Stephen D. Williamson, 1984. "Costly Monitoring, Financial Intermediation, and Equilibrium Credit Rationing," Working Papers 583, Queen's University, Department of Economics.

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