Strategic groups in Polish banking sector and financial stability
The paper provides results of research concerning identification of strategic groups in the Polish banking sector and tests of the usefulness of these groups in the assessment of financial stability. The theory of strategic groups predicts the existence of stable groups of companies, stemming from the strategy adopted by them. The theory also predicts that groups differ in performance. Our empirical research, preceded by a review of relevant literature, has been carried out on the basis of a cluster analysis with the use of Ward’s algorithm that optimises allocation of banks into groups. We have identified strategic groups in the Polish banking sector, sustained over time after the year 2000. We have also observed statistically significant differences in performance between banks belonging to different groups, and we have demonstrated further that modelling of profitability within groups with the use of regression yields more precise estimates of parameters than in the case of estimation of a model for the whole sector. Thus, breaking down the whole banking sector into strategic groups creates a possibility to forecast the banking sector earnings in a more precise way, i.e. to provide a more precise ex ante assessment of stability of the financial system.
|Date of creation:||01 Mar 2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
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.:
- Caves, R E & Porter, M E, 1977. "From Entry Barriers to Mobility Barriers: Conjectural Decisions and Contrived Deterrence to New Competition," The Quarterly Journal of Economics, MIT Press, vol. 91(2), pages 241-61, May.
- Oster, Sharon M, 1982. "Intraindustry Structure and the Ease of Strategic Change," The Review of Economics and Statistics, MIT Press, vol. 64(3), pages 376-83, August.
- Charles A.E. Goodhart & Pojanart Sunirand & Dimitrios P. Tsomocos, 2004.
"A Model to Analyse Financial Fragility: Applications,"
OFRC Working Papers Series
2004fe05, Oxford Financial Research Centre.
- Goodhart, Charles A. E. & Sunirand, Pojanart & Tsomocos, Dimitrios P., 2004. "A model to analyse financial fragility: applications," Journal of Financial Stability, Elsevier, vol. 1(1), pages 1-30, September.
- Charles Goodhart & Pojanart Sunirand & Dimitrios P. Tsomocos, 2004. "A model to analyse financial fragility: applications," LSE Research Online Documents on Economics 24680, London School of Economics and Political Science, LSE Library.
- Dimitrios P Tsomocos & Charles A.E. Goodhart, 2004. "A Model to Analyse Financial Fragility: Applications," Economics Series Working Papers 2004-FE-05, University of Oxford, Department of Economics.
- Porter, Michael E, 1979. "The Structure within Industries and Companies' Performance," The Review of Economics and Statistics, MIT Press, vol. 61(2), pages 214-27, May.
- C. West Churchman, 1963. "The X of X," Management Science, INFORMS, vol. 9(3), pages 351-357, April.
- Tremblay, Victor J, 1985. "Strategic Groups and the Demand for Beer," Journal of Industrial Economics, Wiley Blackwell, vol. 34(2), pages 183-98, December.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:326. 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: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.