Financial Openness, Market Structure and Private Credit: An Empirical Investigation

Ronald Fischer and Patricio Valenzuela

No 297, Documentos de Trabajo from Centro de Economía Aplicada, Universidad de Chile

Abstract: This paper empirically examines whether the effect of financial openness on private credit depends on the market structure of the banking sector prior liberalization. We find that financial openness has a positive effect on private credit in countries characterized by a highly competitive banking sector. However, this effect vanishes and even becomes negative in countries where the market structure is one of imperfect competition. These findings are consistent with the predictions of recent theoretical models.

Date: 2013
New Economics Papers: this item is included in nep-cba, nep-com and nep-spo
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Citations: View citations in EconPapers (10)

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Related works:
Journal Article: Financial openness, market structure and private credit: An empirical investigation (2013)
Working Paper: Financial Openness, Market Structure and Private Credit: An Empirical Investigation (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:edj:ceauch:297

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