IDEAS home Printed from https://ideas.repec.org/p/cdf/wpaper/2009-7.html
   My bibliography  Save this paper

Market Power versus Efficient-Structure in Arab GCC Banking

Author

Listed:

Abstract

This paper evaluates the performance of the Arab GCC banking industry in the context of the Structure-Conduct-Performance hypothesis in the period 1993-2002. The paper uses panel estimation differentiating between bank fixed effects and country fixed effects. It examines the Relative-Market-Power and the Efficient-Structure hypotheses differentiating between the two by employing a non-parametric measure of technical efficiency, and finds that the banking industry in the Arab GCC countries is best explained by the mainstream SCP hypothesis. The empirical results do not find any support for the Hicks (1935) "Quiet Life" version of the market power hypothesis.

Suggested Citation

  • Al-Muharrami, Saeed & Matthews, Kent, 2009. "Market Power versus Efficient-Structure in Arab GCC Banking," Cardiff Economics Working Papers E2009/7, Cardiff University, Cardiff Business School, Economics Section.
  • Handle: RePEc:cdf:wpaper:2009/7
    as

    Download full text from publisher

    File URL: http://carbsecon.com/wp/E2009_7.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Hannan, Timothy H., 1991. "Bank commercial loan markets and the role of market structure: evidence from surveys of commercial lending," Journal of Banking & Finance, Elsevier, vol. 15(1), pages 133-149, February.
    2. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    3. Berger, Allen N, 1995. "The Relationship between Capital and Earnings in Banking," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 27(2), pages 432-456, May.
    4. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    5. Douglas D. Evanoff & Diana L. Fortier, 1987. "Reevaluation of the structure-conduct-performance paradigm in banking," Staff Memoranda 87-9, Federal Reserve Bank of Chicago.
    6. Demsetz, Harold, 1973. "Industry Structure, Market Rivalry, and Public Policy," Journal of Law and Economics, University of Chicago Press, vol. 16(1), pages 1-9, April.
    7. Goldberg, Lawrence G. & Rai, Anoop, 1996. "The structure-performance relationship for European banking," Journal of Banking & Finance, Elsevier, vol. 20(4), pages 745-771, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Maghyereh, Aktham I. & Awartani, Basel, 2012. "Financial integration of GCC banking markets: A non-parametric bootstrap DEA estimation approach," Research in International Business and Finance, Elsevier, vol. 26(2), pages 181-195.
    2. Andrieş, Alin Marius & Căpraru, Bogdan, 2014. "The nexus between competition and efficiency: The European banking industries experience," International Business Review, Elsevier, vol. 23(3), pages 566-579.
    3. repec:eee:ecofin:v:42:y:2017:i:c:p:531-545 is not listed on IDEAS
    4. Asongu, Simplice & Biekpe, Nicholas, 2017. "ICT, Information Asymmetry and Market Power in the African Banking Industry," MPRA Paper 81702, University Library of Munich, Germany.
    5. Setiawan, Maman & Emvalomatis, Grigorios & Oude Lansink, Alfons, 2012. "The relationship between technical efficiency and industrial concentration: Evidence from the Indonesian food and beverages industry," Journal of Asian Economics, Elsevier, vol. 23(4), pages 466-475.
    6. Alin Marius Andrieş & Bogdan Căpraru, 2012. "Competition and efficiency in EU27 banking systems," Baltic Journal of Economics, Baltic International Centre for Economic Policy Studies, vol. 12(1), pages 41-60, July.
    7. Simplice Asongu & Enowbi Batuo & Jacinta Nwachukwu & Vanessa Tchamyou, 2016. "Is information diffusion a threat to market power for financial access? Insights from the African banking industry," Working Papers 16/039, African Governance and Development Institute..
    8. Kondo, Kazumine, 2014. "Do Credit Associations Compete with Each Other in Japanese Regional Lending Markets?," MPRA Paper 56669, University Library of Munich, Germany.
    9. Kondo, Kazumine, 2014. "Cross-Prefecture Expansion of Regional Banks in Japan and Its Effects on Lending-Based Income," MPRA Paper 52978, University Library of Munich, Germany.
    10. Matthews, Kent, 2010. "Banking Efficiency in Emerging Market Economies," Cardiff Economics Working Papers E2010/12, Cardiff University, Cardiff Business School, Economics Section.
    11. repec:ris:badest:0539 is not listed on IDEAS
    12. Homma, Tetsushi & Tsutsui, Yoshiro & Uchida, Hirofumi, 2014. "Firm growth and efficiency in the banking industry: A new test of the efficient structure hypothesis," Journal of Banking & Finance, Elsevier, vol. 40(C), pages 143-153.
    13. Kazumine Kondo, 2017. "Do credit associations compete with each other in Japanese regional lending markets?," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 41(1), pages 195-210, January.
    14. repec:taf:oaefxx:v:3:y:2015:i:1:p:1017947 is not listed on IDEAS
    15. Mahmood ul Hasan Khan & Muhammad Nadim Hanif, 2017. "An Empirical Evaluation of ‘Structure-Conduct-Performance’ and ‘Efficient-Structure’ Paradigms in the Banking Sector of Pakistan," SBP Working Paper Series 90, State Bank of Pakistan, Research Department.

    More about this item

    Keywords

    GCC Banking; Structure Conduct Performance;

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cdf:wpaper:2009/7. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Yongdeng Xu). General contact details of provider: http://edirc.repec.org/data/ecscfuk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.