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Bank Competition and Outreach: Evidence from Turkey

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  • A. FARUK AYSAN
  • M. DISLI

    ()

  • K. SCHOORS

Abstract

In light of the importance of banking sector outreach and given concerns that competition may adversely affect it, this study explores the empirical linkage between banking structure and outreach in Turkey for the period 1988–2010. Bank-, province-, and bank-province-level estimation results indicate that competition is in general conducive to the outreach of banks. We do not find evidence for collusive behavior between banks when they have multimarket contact. On the province-level, thepresence of foreign owned banks is associated with higher outreach, while at the bank-province levelwe observe that outreach of domestic banks exceeds that of foreign banks. Together, these results suggest that there are pro-competitive spillover effects from foreign banks to their domestic counterparts.

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Paper provided by Ghent University, Faculty of Economics and Business Administration in its series Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium with number 13/839.

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Date of creation: Apr 2013
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Handle: RePEc:rug:rugwps:13/839

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Keywords: bank competition; multimarket contact; bank outreach.;

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