Conflicts of Interest and Credible Information Provision by Specialized and One-Stop Banks

Joel Shapiro, Patrick Bolton and Xavier Freixas ()

No 132, Econometric Society 2004 North American Winter Meetings from Econometric Society

Abstract: This paper is concerned with the general question of the provision of information by financial intermediaries to their customers. Specifically, it analyzes the different ways the market can be organized and its effects on pricing and the level of information investors obtain. We find that market structure depends on on the reputation costs, switching costs for customers, and the existence of market power. This provides a new justification for the presence of one-stop banks. We demonstrate these findings by embedding signaling within a model of multi-product price competition.

Keywords: One-stop Bank; Information Provision; Signaling (search for similar items in EconPapers)
JEL-codes: G20 L11 L15 (search for similar items in EconPapers)
Date: 2004-08-11
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Persistent link: https://EconPapers.repec.org/RePEc:ecm:nawm04:132

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