Productivity and Income-Redistribution Impacts of Banking Liberalisation in Europe - An Empirical Analysis Based on the Melitz Model\par
Clemens Sager ()
Additional contact information
Clemens Sager: IUHEI, The Graduate Institute of International Studies, Geneva
No 14-2006, IHEID Working Papers from Economics Section, The Graduate Institute of International Studies
This paper tests empirically several assumptions and predictions of the Melitz (2003) and Baldwin and Forslid (2004) heterogeneous firm framework. The focus is on liberalisation-induced productivity and profitability consequences for international and regional banks in seven European countries during the 1988 to 2003 period. Confirming higher productivity and profitability for international banks throughout the investigated period, the panel data analysis also establishes a positive link between higher international market participation and bank productivity. It also provides evidence for an increase in aggregate banking productivity that can be attributed to banking liberalisation. On the other hand, our results do neither detect a narrowing of the productivity gap nor a widening of the profitability gap between international and regional banks. This can be accounted for by the particular regulatory environment of the banking sector as well as the deregulatory nature of banking liberalisation only affecting fixed trade costs but not variable trade costs.\par
Keywords: Banking liberalisation; deregulation; firm heterogeneity; firm performance; productivity; first and second banking directives\par (search for similar items in EconPapers)
JEL-codes: F14 D21 G21 L25 (search for similar items in EconPapers)
Pages: 41 pages
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:gii:giihei:heiwp14-2006
Access Statistics for this paper
More papers in IHEID Working Papers from Economics Section, The Graduate Institute of International Studies Contact information at EDIRC.
Bibliographic data for series maintained by Dorina Dobre ().