Banking Competition and Bank Size: Some Evidence from Italy

Paolo Coccorese and Laura Santucci ()
Additional contact information
Laura Santucci: University of Salerno

Journal of Economics and Finance, 2020, vol. 44, issue 2, No 4, 278-299

Abstract: Abstract This paper assesses the degree of competition of the Italian banking industry and investigates whether there are differences in the competitive behaviour related to the size of the intermediaries. Competition is measured using the Bresnahan-Lau model, estimated on a panel dataset of 125 observations over the period 1989-2013. Annual data are collected from the Bank of Italy, and are aggregated into dimensional categories: major, large, medium, small, and minor banks. The results suggest that the sector is rather competitive and that the level of competitiveness has increased over the observed period. Besides, the events occurred in the Nineties seem to have had a structural effect on banks’ market power, as well as the aftermath of the recent financial crisis. The estimates also point out that smaller banks enjoy a higher degree of market power, which is consistent with the relationship lending that characterizes the interaction between banks and borrowers in Italy.

Keywords: Banking; Competition; Conjectural variation; Bank size (search for similar items in EconPapers)
JEL-codes: G21 L10 L13 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://link.springer.com/10.1007/s12197-019-09488-2 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:spr:jecfin:v:44:y:2020:i:2:d:10.1007_s12197-019-09488-2

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/12197/PS2

DOI: 10.1007/s12197-019-09488-2

Access Statistics for this article

Journal of Economics and Finance is currently edited by James Payne

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