Deregulation, Competition and Consumer Welfare in Banking Market: Evidence from Hong Kong
Chun-Yu Ho ()
No 242007, Working Papers from Hong Kong Institute for Monetary Research
This paper examines competition among commercial banks following deregulation in a small open economy. I jointly estimate a system of differentiated product demand and pricing equations, and use conduct parameters to identify market structure. The empirical results show that the banking sector is characterized by the Nash-Bertrand equilibrium in which bank size is important for product differentiation. Following deregulation, bank competition intensifies and cost efficiency improves.
Keywords: Banking; Conduct Parameters; Consumer Welfare; Demand; Deregulation; Hong Kong; Product Differentiation (search for similar items in EconPapers)
JEL-codes: G21 L13 (search for similar items in EconPapers)
Pages: 29 pages
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Journal Article: Deregulation, competition and consumer welfare in a banking market: evidence from Hong Kong (2010)
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