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Financial conglomeration and monitoring incentives

  • Mälkönen, Ville
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    If combining insurance and banking services generates scope economies in terms of monitoring the customers, competition in the financial markets becomes more intense after financial conglomeration. The pro-competitive effect reduces the prices of the financial services, increases monitoring and improves financial stability. Increased monitoring allows financial regulators apply lower capital requirements for financial conglomerates.

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    Article provided by Elsevier in its journal Journal of Financial Stability.

    Volume (Year): 5 (2009)
    Issue (Month): 2 (June)
    Pages: 105-123

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    Handle: RePEc:eee:finsta:v:5:y:2009:i:2:p:105-123
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