Advanced Search
MyIDEAS: Login

Intensity of Competition and Market Structure in the Italian Banking Industry

Contents:

Author Info

  • Giannetti, C.

    (Tilburg University, Center for Economic Research)

Abstract

This work tests the predictions of Sutton’s model of independent submarkets for the Italian retail banking industry. In the first part of this paper, I develop a model of endogenous mergers to evidence the relationship between firms’ conduct, market entry and market structure. In the second part, I identify the submarket dimension and estimate the relationship between market size and market structure using data on bank branches. The size of the submarkets turned out to be at most provincial whereas the limiting concentration index - as argued by Sutton for industries with exogenous sunk costs - goes to zero as the market becomes larger.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://arno.uvt.nl/show.cgi?fid=77320
Our checks indicate that this address may not be valid because: 404 Not Found. If this is indeed the case, please notify (Richard Broekman)
Download Restriction: no

Bibliographic Info

Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2008-43.

as in new window
Length:
Date of creation: 2008
Date of revision:
Handle: RePEc:dgr:kubcen:200843

Contact details of provider:
Web page: http://center.uvt.nl

Related research

Keywords: Concentration; Truncated Poisson and Negative Binomial models; quantile regressions;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Petersen, Mitchell A & Rajan, Raghuram G, 1995. "The Effect of Credit Market Competition on Lending Relationships," The Quarterly Journal of Economics, MIT Press, vol. 110(2), pages 407-43, May.
  2. Asplund, Marcus & Sandin, Rickard, 1999. "The Number of Firms and Production Capacity in Relation to Market Size," Journal of Industrial Economics, Wiley Blackwell, vol. 47(1), pages 69-85, March.
  3. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2006. "The Cost of Banking Regulation," NBER Working Papers 12501, National Bureau of Economic Research, Inc.
  4. Astrid A. Dick, 2007. "Market Size, Service Quality, and Competition in Banking," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 39(1), pages 49-81, 02.
  5. Ellickson, Paul, 2005. "Does Sutton Apply to Supermarkets?," Working Papers 05-05, Duke University, Department of Economics.
  6. Berger, Allen N. & Dai, Qinglei & Ongena, Steven & Smith, David C., 2003. "To what extent will the banking industry be globalized? A study of bank nationality and reach in 20 European nations," Journal of Banking & Finance, Elsevier, vol. 27(3), pages 383-415, March.
  7. Buzzacchi, Luigi & Valletti, Tommaso M., 2006. "Firm size distribution: Testing the "independent submarkets model" in the Italian motor insurance industry," International Journal of Industrial Organization, Elsevier, vol. 24(4), pages 809-834, July.
  8. Vasconcelos, Helder, 2006. "Endogenous mergers in endogenous sunk cost industries," International Journal of Industrial Organization, Elsevier, vol. 24(2), pages 227-250, March.
  9. Leslie E. Papke & Jeffrey M. Wooldridge, 1993. "Econometric Methods for Fractional Response Variables with an Application to 401(k) Plan Participation Rates," NBER Technical Working Papers 0147, National Bureau of Economic Research, Inc.
  10. Marcello Bofondi & Giorgio Gobbi, 2004. "Bad Loans and Entry into Local Credit Markets," Temi di discussione (Economic working papers) 509, Bank of Italy, Economic Research and International Relations Area.
  11. Gurmu, Shiferaw & Trivedi, Pravin K., 1992. "Overdispersion tests for truncated Poisson regression models," Journal of Econometrics, Elsevier, vol. 54(1-3), pages 347-370.
  12. Guiso, Luigi & Sapienza, Paola & Zingales, Luigi, 2002. "Does Local Financial Development Matter?," CEPR Discussion Papers 3307, C.E.P.R. Discussion Papers.
  13. Vittoria Cerasi & Barbara Chizzolini & Marc Ivaldi, 2002. "Branching and competition in the European banking industry," Applied Economics, Taylor & Francis Journals, vol. 34(17), pages 2213-2225.
  14. Grogger, J T & Carson, Richard T, 1991. "Models for Truncated Counts," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 6(3), pages 225-38, July-Sept.
  15. Andew Cohen & Michael Mazzeo, 2004. "Market structure and competition among retail depository institutions," Finance and Economics Discussion Series 2004-04, Board of Governors of the Federal Reserve System (U.S.).
  16. Berger, Allen N. & Udell, Gregory F., 2006. "A more complete conceptual framework for SME finance," Journal of Banking & Finance, Elsevier, vol. 30(11), pages 2945-2966, November.
  17. Patrick Paul Walsh & Ciara Whelan, 2002. "Portfolio Effects and Firm Size Distribution - Carbonated Soft Drinks," The Economic and Social Review, Economic and Social Studies, vol. 33(1), pages 43-54.
  18. Felici Roberto & Pagnini Marcello, 2005. "Distance, bank heterogeneity and entry in local banking markets," Temi di discussione (Economic working papers) 557, Bank of Italy, Economic Research and International Relations Area.
  19. V. Cerasi & B. CHIZZOLINI & M. IVALDI, 1998. "Branching and Competitiveness across Regions in the Italian Banking Industry," Departmental Working Papers 1998-03, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
  20. Gurmu, Shiferaw, 1991. "Tests for Detecting Overdispersion in the Positive Poisson Regression Model," Journal of Business & Economic Statistics, American Statistical Association, vol. 9(2), pages 215-22, April.
  21. S. Baranzoni & P. Bianchi & L. Lambertini, 2000. "Market Structure," Working Papers 368, Dipartimento Scienze Economiche, Universita' di Bologna.
  22. Symeonidis, George, 2000. "Price Competition and Market Structure: The Impact of Cartel Policy on Concentration in the UK," Journal of Industrial Economics, Wiley Blackwell, vol. 48(1), pages 1-26, March.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Adam Baszynski, 2011. "Mergers and acquisitions in the banking sector and the competitive structure of the banking services market in Poland since 2004," Ekonomia i Prawo, Uniwersytet Mikolaja Kopernika, vol. 7(1), pages 391-407, December.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:dgr:kubcen:200843. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Richard Broekman).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.