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Multimarket spatial competition in the Colombian deposit market

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  • Dairo Estrada

    ()

  • Sandra Rozo

    ()

Abstract

This paper presents a multimarket spatial competition oligopoly model for the Colombian deposit market, in line with the New Empirical Industrial Organization (NEIO) approach. In this framework, banks use price and non-price strategies to compete in the market, which allows us to analyze the country and the regional competitiveness level. The theoretical model is applied to quarterly Colombian data that covers the period between 1996 and 2005. Our results suggest that, although the country deposit market appears to be more competitive than the Nash equilibrium, there are some local areas within the country that present evidence of market power.

Suggested Citation

  • Dairo Estrada & Sandra Rozo, 2006. "Multimarket spatial competition in the Colombian deposit market," Borradores de Economia 413, Banco de la Republica de Colombia.
  • Handle: RePEc:bdr:borrec:413
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    References listed on IDEAS

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    Cited by:

    1. Temesvary, Judit, 2015. "Dynamic branching and interest rate competition of commercial banks: Evidence from Hungary," International Journal of Industrial Organization, Elsevier, vol. 43(C), pages 98-110.
    2. Andrés Murcia Pabón, 2007. "Determinantes Del Acceso Al Crédito De Los Hogares Colombianos," ENSAYOS SOBRE POLÍTICA ECONÓMICA, BANCO DE LA REPÚBLICA - ESPE, vol. 25(55), pages 40-83, December.

    More about this item

    Keywords

    Banking; Location; Competition; Colombia. Classification JEL: D4; G21; L13; R12.;

    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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