Vertical Differentiation, Risk-Taking and Retail Funding

David Jaume, Martin Tobal and Renato Yslas ()
Additional contact information
Renato Yslas: Banco de México

Journal of Financial Services Research, 2023, vol. 64, issue 1, No 4, 133-153

Abstract: Abstract Results of previous studies of the relationship between bank competition and bank risk-taking have differed in findings but most have used the same sort of barriers to perfect competition, such as entry barriers and differences in bank default risk. This study suggests that banks that compete more effectively in the deposit market using nonprice features such as differences in services and advertising gain market power and such market power gives them incentives to take less risk. Banks that compete less effectively take more risk. Empirical evidence supports the predictions of the model.

Keywords: Risk taking; Vertical Differentiation; Deposits (search for similar items in EconPapers)
JEL-codes: D43 G21 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10693-022-00391-2 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jfsres:v:64:y:2023:i:1:d:10.1007_s10693-022-00391-2

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/10693

DOI: 10.1007/s10693-022-00391-2

Access Statistics for this article

Journal of Financial Services Research is currently edited by Haluk Unal

More articles in Journal of Financial Services Research from Springer, Western Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().