On Deposit Interest Rate Regulation and Deregulation
Jürgen Eichberger and
Ian R Harper
Journal of Industrial Economics, 1989, vol. 38, issue 1, 19-30
A model is developed in which two financial firms, a "bank" and a " non-bank," complete duopsonistically for deposit balances. It is shown first that the imposition of a deposit interest rate ceiling on the bank can increase its profit. It is then shown that an increase in the degree of substitutability between the two types of deposits can reverse the conclusion regarding the profitability of an interest-rate ceiling. The analysis is used to support the conclusion that a bank may initially seek the imposition of a deposit interest-rate ceiling and subsequently seek its removal, thus providing a " private interest" explanation of recent bank deregulation. Copyright 1989 by Blackwell Publishing Ltd.
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
http://links.jstor.org/sici?sici=0022-1821%2819890 ... 0.CO%3B2-7&origin=bc full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:jindec:v:38:y:1989:i:1:p:19-30
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0022-1821
Access Statistics for this article
Journal of Industrial Economics is currently edited by Pierre Regibeau, Yeon-Koo Che, Kenneth Corts, Thomas Hubbard, Patrick Legros and Frank Verboven
More articles in Journal of Industrial Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().