An Industrial Organization Analysis for the Colombian Banking System
This paper presents two versions of a spatial competition model forthe banking sector. The first version, describes a framework that fol-lows closely Salop´s spatial competition model. This version is modi-fied in the second part by introducing the loan market and default riskprobabilities for credit. Both theoretical approaches are analyzed em-pirically for the Colombian data,covering the period 1996-2005. Ourresults allow us to construct a deviation of the observed number ofbranches from an optimal number of branches for the banking systemthroughout the period of study. The deviation indicates that in thelast years the number of branches is below the optimum which sug-gest that political measures should focus in increasing the number ofbranches in the country. Additionally, we found empirical evidenceof market separability between the loan and deposit markets, and fi-nally, we were able to determine the signs of the relations betweencredit collateral, payment probability and interest rates.
|Date of creation:||26 Aug 2008|
|Date of revision:|
|Contact details of provider:|| |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Sherrill Shaffer, 1990.
"A test of competition in Canadian banking,"
90-18, Federal Reserve Bank of Philadelphia.
- Eduardo Levy Yeyati & Alejandro Micco, 2003.
"Concentration and Foreign Penetration in Latin American Banking Sectors: Impact on Competition and Risk,"
Research Department Publications
4353, Inter-American Development Bank, Research Department.
- Yeyati, Eduardo Levy & Micco, Alejandro, 2007. "Concentration and foreign penetration in Latin American banking sectors: Impact on competition and risk," Journal of Banking & Finance, Elsevier, vol. 31(6), pages 1633-1647, June.
- Eduardo Levy Yeyati & Alejandro Micco, 2003. "Concentration and Foreign Penetration in Latin American Banking Sectors: Impact on Competition and Risk," IDB Publications (Working Papers) 6514, Inter-American Development Bank.
- Eduardo Levy Yeyati & Alejandro Micco, 2003. "Concentration and Foreign Penetration in Latin American Banking Sectors: Impact on Competition and Risk," Business School Working Papers cinco, Universidad Torcuato Di Tella.
- Biorn,E., 1999. "Estimating regression systems from unbalanced panel data : a stepwise maximum likelihood procedure," Memorandum 20/1999, Oslo University, Department of Economics.
- Hirofumi Uchida & Yoshiro Tsutsui, 2002.
"Has Competition in the Japanese Banking Sector Improved?,"
Discussion Papers in Economics and Business
02-09-Rev, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Sep 2003.
- Uchida, Hirofumi & Tsutsui, Yoshiro, 2005. "Has competition in the Japanese banking sector improved?," Journal of Banking & Finance, Elsevier, vol. 29(2), pages 419-439, February.
- Shaffer, Sherrill, 1989. "Competition in the U.S. banking industry," Economics Letters, Elsevier, vol. 29(4), pages 321-323.
- Xavier Freixas & Jean-Charles Rochet, 1997. "Microeconomics of Banking," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061937.
- Moshe Kim & Ana Lozano-Vivas & Antonio Morales, 2007. "Multistrategic Spatial Competition in Banking," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 14(3), pages 351-366.
- Neven, Damien & Roller, Lars-Hendrik, 1999. "An aggregate structural model of competition in the European banking industry," International Journal of Industrial Organization, Elsevier, vol. 17(7), pages 1059-1074, October.
- Adolfo Barajas & Roberto Steiner & Natalia Salazar, 1999. "Interest Spreads in Banking in Colombia, 1974-96," IMF Staff Papers, Palgrave Macmillan, vol. 46(2), pages 4.
- Dairo Estrada, . "Efectos de las fusiones sobre el mercado financiero colombiano," Borradores de Economia 329, Banco de la Republica de Colombia.
- Economides, Nicholas, 1989. "Desirability of Compatibility in the Absence of Network Externalities," American Economic Review, American Economic Association, vol. 79(5), pages 1165-81, December.
- Berg, Sigbjorn Atle & Kim, Moshe, 1994. "Oligopolistic Interdependence and the Structure of Production in Banking: An Empirical Evaluation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 26(2), pages 309-22, May.
- Pita Barros, Pedro, 1999. "Multimarket competition in banking, with an example from the Portuguese market," International Journal of Industrial Organization, Elsevier, vol. 17(3), pages 335-352, April.
When requesting a correction, please mention this item's handle: RePEc:col:000094:005001. 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: (Clorith Angélica Bahos Olivera)
If references are entirely missing, you can add them using this form.