Entry of Foreign Banks and their Impact on Host Countries

Maria Lehner and Monika Schnitzer ()

No 2, Working Papers from Bavarian Graduate Program in Economics (BGPE)

Abstract: Foreign bank entry is frequently associated with spillover e¤ects for local banks and increasing competition in the local banking market. We study the impact of these e¤ects on host countries. In particular, we ask how these e¤ects interact and how they depend on the competitive environment of the host banking market. An increasing number of banks is more likely to have positive welfare e¤ects the more competitive the market environment, whereas spillovers are less likely to have positive welfare e¤ects the stronger competition. Hence, competitive e¤ects seem to reinforce each other, while spillovers and competition tend to weaken each other.

Keywords: foreign bank entry; multinational bank; competition in banking; spillover effects (search for similar items in EconPapers)
JEL-codes: F37 G21 L13 O16 (search for similar items in EconPapers)
Date: 2006-07
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http://www.bgpe.de/texte/DP/002_lehner_schnitzer.pdf First version, 2006 (application/pdf)

Related works:
Working Paper: Entry of Foreign Banks and their Impact on Host Countries (2006)
Working Paper: Entry of Foreign Banks and their Impact on Host Countries (2006)
Working Paper: Entry of Foreign Banks and their Impact on Host Countries (2006)
Journal Article: Entry of foreign banks and their impact on host countries (2008)
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Persistent link: http://EconPapers.repec.org/RePEc:bav:wpaper:002_lehner_schnitzer

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