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Revisiting The Quiet Life Hypothesis in The Indonesian Banking Industry

Author

Listed:
  • Samuel Sumartoyo

    (Universitas Indonesia, Indonesia)

  • Chaikal Nuryakin

    (Universitas Indonesia, Indonesia)

Abstract

This study explores the Quiet Life Hypothesis (QLH) in different bank groups based on market-dominant and state ownership. The instrumental-variable regression results confirm the quiet life hypothesis at the industry level. At the group level, there is no different tendency to act quiet life between the dominant and non-dominant banks. On the other hand, the State-Owned Banks (SOBs) show a more potent act of quiet life than private banks. While the results for SOB were backed by theory and previous empirical studies, they raised the question of why the private banks conduct such “lazy†behavior.

Suggested Citation

  • Samuel Sumartoyo & Chaikal Nuryakin, 2025. "Revisiting The Quiet Life Hypothesis in The Indonesian Banking Industry," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 28(4), pages 507-522, December.
    • Handle: RePEc:idn:journl:v:28:y:2025:i:4a:p:507-522
    DOI: https://doi.org/10.59091/2460-9196.2756
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    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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