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Bank concentration and crises

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  • Beck, Thorsten
  • Demirguc-Kunt, Asli
  • Levine, Ross

Abstract

The authors study the impact of bank concentration, regulations, and national institutions on the likelihood of suffering a systemic banking crisis. Using data on 79 countries over the period 1980-97, they find that crises are less likely (1) in more concentrated banking systems, (2) in countries with fewer regulatory restrictions on bank competition and activities, and (3) in economies with better institutions, that is, institutions that encourage competition and support private property rights.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3041.

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Date of creation: 31 May 2003
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Handle: RePEc:wbk:wbrwps:3041

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Keywords: Financial Crisis Management&Restructuring; Banks&Banking Reform; Labor Policies; Payment Systems&Infrastructure; Financial Intermediation; Financial Crisis Management&Restructuring; Financial Intermediation; Economic Theory&Research; Environmental Economics&Policies; Banks&Banking Reform;

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  22. Kevin C. Murdock & Thomas F. Hellmann & Joseph E. Stiglitz, 2000. "Liberalization, Moral Hazard in Banking, and Prudential Regulation: Are Capital Requirements Enough?," American Economic Review, American Economic Association, vol. 90(1), pages 147-165, March.
  23. Yuk-Shee Chan & Stuart I. Greenbaum & Anjan V. Thakor, 2004. "Is Fairly Priced Deposit Insurance Possible?," Finance 0411018, EconWPA.
  24. Sharpe, William F., 1978. "Bank Capital Adequacy, Deposit Insurance and Security Values," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 13(04), pages 701-718, November.
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  26. Thorsten Beck & Asli Demirgüç-Kunt & Ross Levine, 2000. "A New Database on the Structure and Development of the Financial Sector," World Bank Economic Review, World Bank Group, vol. 14(3), pages 597-605, September.
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  28. Barth, James R. & Caprio, Gerard & Levine, Ross, 2000. "Banking systems around the globe : do regulation and ownership affect the performance and stability?," Policy Research Working Paper Series 2325, The World Bank.
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