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Strategy, Competition And Diversification In European And Mexican Banking

Author

Listed:
  • Bernardo Batiz-Lazo

    (Open University Business School)

  • Douglas Wood

    (Manchester Business School)

Abstract

This article identifies whether top managers in banks’ parent companies are highly involved in the design of strategy and examines how management styles influence (or reflect influences) on diversification decisions within bank markets. Alongside this assessment, the research ranks the main concerns to design strategy in banking within an international setting (including the role of information and telecommunication technologies in the design and implementation of banks’ diversification strategies). Results emerging from triangulating responses suggested that, on balance, top managers in bank markets are predisposed to integrate around purely strategic rather than purely financial targets or than a combination of strategic and financial performance. Management of diversity does not seem to be time invariant with results suggesting that information technology management played a secondary role in the design of bank strategy but at the same time, information technology applications were perceived as an important force to modify competition in bank markets.

Suggested Citation

  • Bernardo Batiz-Lazo & Douglas Wood, 2002. "Strategy, Competition And Diversification In European And Mexican Banking," Industrial Organization 0211013, EconWPA.
  • Handle: RePEc:wpa:wuwpio:0211013
    Note: Type of Document - pdf; to print on HP/PostScript/Franciscan monk; pages: 35
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    File URL: http://econwpa.repec.org/eps/io/papers/0211/0211013.pdf
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    References listed on IDEAS

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    1. R. E. Caves & M. E. Porter, 1977. "From Entry Barriers to Mobility Barriers: Conjectural Decisions and Contrived Deterrence to New Competition," The Quarterly Journal of Economics, Oxford University Press, vol. 91(2), pages 241-261.
    2. Humphrey, David B & Pulley, Lawrence B, 1997. "Banks' Responses to Deregulation: Profits, Technology, and Efficiency," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 29(1), pages 73-93, February.
    3. 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.
    4. Canals, Jordi, 1994. "Competitive Strategies in European Banking," OUP Catalogue, Oxford University Press, number 9780198773504.
    5. Lloyd-Williams, D. M. & Molyneux, Phil & Thornton, John, 1994. "Market structure and performance in Spanish banking," Journal of Banking & Finance, Elsevier, vol. 18(3), pages 433-443, May.
    6. Walter, Ingo, 1997. "Universal banking: A shareholder value perspective," European Management Journal, Elsevier, vol. 15(4), pages 344-360, August.
    7. Gilbert, R Alton, 1984. "Bank Market Structure and Competition: A Survey," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 16(4), pages 617-644, November.
    8. Geroski, P. A., 1995. "What do we know about entry?," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 421-440, December.
    9. Teece, David J., 1980. "Economies of scope and the scope of the enterprise," Journal of Economic Behavior & Organization, Elsevier, vol. 1(3), pages 223-247, September.
    10. Ingo Walter, 1997. "Universal Banking: A Shareholder Value Perspective," New York University, Leonard N. Stern School Finance Department Working Paper Seires 96-40, New York University, Leonard N. Stern School of Business-.
    11. Davis, E. Philip & De Bandt, Olivier, 1999. "A cross-country comparison of market structures in European banking," Working Paper Series 0007, European Central Bank.
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    More about this item

    Keywords

    Banks; competition; IT innovation;

    JEL classification:

    • L - Industrial Organization

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