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A dynamic theory of the credit union

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  • Geoffrey Rubin
  • George Overstreet
  • Peter Beling
  • Kanshukan Rajaratnam

Abstract

A topic of recent interest in the retail financial sector has been the growth of credit unions or “pure cooperatives”. Past credit union researchers built mathematical models of credit union operations. These models identified important operating characteristics but were modeled under assumptions of static operating environments. The model presented in this paper departs from the traditional static models and examines dynamic operation for a United States credit union. Its inter-temporal structure clarifies a number of issues—such as optimal equity retention and inter-temporal rate policy—not addressed by earlier studies. Given initial conditions, the model specifies equity retention and inter-temporal deposit and loan rate policies until an equilibrium state is reached. Copyright Springer Science+Business Media New York 2013

Suggested Citation

  • Geoffrey Rubin & George Overstreet & Peter Beling & Kanshukan Rajaratnam, 2013. "A dynamic theory of the credit union," Annals of Operations Research, Springer, vol. 205(1), pages 29-53, May.
    • Handle: RePEc:spr:annopr:v:205:y:2013:i:1:p:29-53:10.1007/s10479-012-1246-7
    DOI: 10.1007/s10479-012-1246-7
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    References listed on IDEAS

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    Cited by:

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    2. Donal G. MCKILLOP & Barry QUINN, 2015. "Web Adoption By Irish Credit Unions: Performance Implications," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(3), pages 421-443, September.
    3. Goddard, John & McKillop, Donal G. & Wilson, John O.S., 2023. "Who consumes the credit union subsidies?," Journal of Financial Stability, Elsevier, vol. 69(C).
    4. Girma Jirata Duguma & Jiqin Han, 2018. "Effect of Deposit Mobilization on the Financial Sustainability of Rural Saving and Credit Cooperatives: Evidence from Ethiopia," Sustainability, MDPI, vol. 10(10), pages 1-23, September.
    5. Gregory McKee & Albert Kagan, 2016. "Determinants of recent structural change for small asset U.S. credit unions," Review of Quantitative Finance and Accounting, Springer, vol. 47(3), pages 775-795, October.
    6. Saulo Cardoso Maia & Gideon Carvalho Benedicto & José Willer Prado & David Alastair Robb & Oscar Neto Almeida Bispo & Mozar José Brito, 2019. "Mapping the literature on credit unions: a bibliometric investigation grounded in Scopus and Web of Science," Scientometrics, Springer;Akadémiai Kiadó, vol. 120(3), pages 929-960, September.
    7. Sumeetha Natesan & Deepika Thakur & Goutam Dutta & Manoj Kumar Tiwari, 2023. "Pricing and revenue management for bank home loans: a mathematical approach," OPSEARCH, Springer;Operational Research Society of India, vol. 60(2), pages 656-687, June.
    8. Jalal El Fadil & Helyoth Hessou, 2024. "Performance and Assets and Liabilities Management in the U.S. Credit Union," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 14(1), pages 1-6.

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