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Determination of Competition Conventional Bank in Banking Industry in Indonesia

Author

Listed:
  • Ciplis Gema Qori’ah

    (Department of Economics and Development Studies – Faculty of Economics and Business – Universitas Jember)

  • Mochammad Ridwan G

    (Department of Economics and Development Studies – Faculty of Economics and Business – Universitas Jember)

  • Adhitya Wardhono

    (Department of Economics and Development Studies – Faculty of Economics and Business – Universitas Jember)

  • Ika Nurjannah

    (Department of Economics and Development Studies – Faculty of Economics and Business – Universitas Jember)

Abstract

The aim of this study is to determine the level of concentration and competition behavior of conventional commercial banks in the national banking industry. This study focuses on descriptive analysis and quantitative analysis using panel data regression for 9 conventional commercial banks during 2003–2014. Results of eclectic analysis are supposed that behavior of banks is less competitive due to high levels of concentration in the banking industry. While the results of panel data regression show that the variables of bank interest expense, operating expense, other operating incomes and variable of loanable funds significantly affect the income of conventional banks.

Suggested Citation

  • Ciplis Gema Qori’ah & Mochammad Ridwan G & Adhitya Wardhono & Ika Nurjannah, 2016. "Determination of Competition Conventional Bank in Banking Industry in Indonesia," Economics and Finance in Indonesia, Faculty of Economics and Business, University of Indonesia, vol. 62, pages 17-29, April.
    • Handle: RePEc:lpe:efijnl:201602
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    References listed on IDEAS

    as
    1. Tri Mulyaningsih & Anne Daly, 2011. "Competitive Conditions In Banking Industry: An Empirical Analysis Of The Consolidation, Competition And Concentration In The Indonesia Banking Industry Between 2001 And 2009," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 14(2), pages 1-36, October.
    2. Tri Mulyaningsih & Anne Daly, 2011. "Competitive Conditions In Banking Industry: An Empirical Analysis Of The Consolidation, Competition And Concentration In The Indonesia Banking Industry Between 2001 And 2009," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 14(2), pages 1-36, October.
    3. Luis Gutiérrez de Rozas, 2007. "Testing for competition in the Spanish banking industry: The Panzar-Rosse approach revisited," Working Papers 0726, Banco de España.
    4. De Bandt, Olivier & Davis, E. Philip, 2000. "Competition, contestability and market structure in European banking sectors on the eve of EMU," Journal of Banking & Finance, Elsevier, vol. 24(6), pages 1045-1066, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Bank Competition; Panel Data Regression; Banking Industry;
    All these keywords.

    JEL classification:

    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • L80 - Industrial Organization - - Industry Studies: Services - - - General

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