Is competition among cooperative banks a negative sum game?
Paolo Coccorese () and
Journal of Institutional Economics, 2019, vol. 15, issue 4, 673-694
Does â€˜inner competitionâ€™ â€“ rivalry among network members â€“ worsen performance in a network of cooperative banks? By weakening the functionality of the network, inner competition might, in fact, endanger network-dependent scale economies. Testing our hypothesis on Italy's network of mutual cooperative banks (Banche di Credito Cooperativo â€“ BCCs), we find a worsening of performance of both incumbents and (even more) aggressors when BCCs compete among themselves. However, the worsening is mild when BCCs compete with comparable non-mutual banks external to the BCC network. We conclude that inner competition among cooperative banks is a negative sum game and, thus, limiting it would be desirable to preserve the stability of cooperative banking networks.
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Working Paper: Is Competition Among Cooperative Banks a Negative Sum Game? (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:cup:jinsec:v:15:y:2019:i:04:p:673-694_00
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