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A lesson to learn from developed countries: The Case of State Branching Deregulation in the US

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  • Jorge Guillén

Abstract

The era of US state branching deregulation started in 1970 and ended up with the enactment of the Riegle Neal Act of 1994. One of the purposes of the branching restriction was to avoid bank concentration. The following paper addresses the influence of the state deregulation on commercial banks’ efficiency within the U.S. We calculate an indicator of bank efficiency using Data Envelopment Analysis (DEA). The efficiency indicator is used as the primary step to analyze the effect of state branching law deregulation on bank’s efficiency. The analysis is complemented with a failure prediction model using these DEA scores.

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  • Jorge Guillén, 2009. "A lesson to learn from developed countries: The Case of State Branching Deregulation in the US," Estudios de Economia, University of Chile, Department of Economics, vol. 36(1 Year 20), pages 67-95, June.
    • Handle: RePEc:udc:esteco:v:36:y:2009:i:1:p:67-95
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    More about this item

    Keywords

    Data Envelopment Analysis; Input Oriented Models; Interstate Branch Regulation;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination

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