Testing the law of one price in retail banking: An analysis for Colombia using a pair-wise approach

Ana Iregui and Jesus Otero

No 9981, Borradores de Economia from Banco de la Republica

Abstract: We apply a pair-wise approach to test the law of one price for deposit (lending) rates in Colombia. We find that when banks are of different size deposit rates adjust quickly, suggesting a competitive environment. By contrast, lending rates adjust rapidly when banks are of similar size, supporting market segmentation.

Keywords: Law of one price; retail interest rates; Colombia. (search for similar items in EconPapers)
JEL-codes: G21 (search for similar items in EconPapers)
Pages: 11
Date: 2012-09-17
New Economics Papers: this item is included in nep-ban and nep-lam
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http://www.banrep.gov.co/docum/ftp/be_733.pdf

Related works:
Journal Article: Testing the law of one price in retail banking: An analysis for Colombia using a pair-wise approach (2013)
Working Paper: Testing the law of one price in retail banking: An analysis for Colombia using a pair-wise approach (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000094:009981

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