Market power in outputs and inputs: an empirical application to banking

Robert M. Adams, Lars-Hendrik Roller and Robin Sickles
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Robert M. Adams: https://www.federalreserve.gov/econres/robert-m-adams.htm

No 2002-52, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: This paper provides evidence on the empirical separability of input and output market imperfections. We specify a model of banking competition and simultaneously estimate bank conduct in output (loan) and input (deposit) markets. Our results suggest that firms display some degree of non-competitive behavior in both the loan and the deposit markets. Moreover, we find that the input side and the output side are empirically separable, that is, the measurement of market power on one side of the market is not affected by assuming that the other side of the market is perfectly competitive. Our results suggest that empirical studies of market power that concentrate on either the input side or the output side are not subject to significant misspecification error.

Keywords: Banks and banking; Markets (search for similar items in EconPapers)
Date: 2002
New Economics Papers: this item is included in nep-com, nep-fmk, nep-ind and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Related works:
Working Paper: Market Power in Outputs and Inputs: An Empirical Application to Banking (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2002-52

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