Banks, regions and development after the crisis and under the new regulatory system
Pietro Alessandrini (),
Michele Fratianni (),
Luca Papi () and
Alberto Zazzaro ()
No 124, Mo.Fi.R. Working Papers from Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences
One of the most evident consequences of the Great Financial Crisis has been a rapid expansion of banking regulation. We argue that the burden of the new regulatory system is asymmetric, driving small banks to the "too-small-to-survive" zone, while reinforcing the "too-big-to-fail" protection for big banks. The asymmetric effect on banking structure produces related asymmetries on firms and regional economies, in light of the fact that small firms and peripheral regions are highly dependent on bank credit and need strategic proximity of banking structures. Finally, our review of the literature on different countries and on different periods of time, including the financial crisis years, suggests the importance of a differentiated banking model when firms and regions are heterogeneous. There is no obvious optimal size of bank.
Keywords: financial crisis; regulation; small banks; large banks; asymmetries; heterogeneity (search for similar items in EconPapers)
JEL-codes: G01 G18 G21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ban
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Journal Article: Banks, Regions and Development After the Crisis and Under the New Regulatory System (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:anc:wmofir:124
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