TY - JOUR
T1 - The persistence of bank profit
AU - Goddard, J
AU - Liu, H
AU - Molyneux, P
AU - Wilson, John Ogilvie Stephen
PY - 2011/11
Y1 - 2011/11
N2 - This paper examines the intensity of competition in 65 national banking industries. Country-level dynamic panel estimates of the persistence of bank profit are reported and compared. Persistence of bank profit is interpreted as an indicator of the intensity of competition, and as such is found to be consistent with traditional structure-based and conduct-based competition indicators. Persistence is negatively related to the rate of growth in GDP per capita, and positively related to the size of entry barriers. Persistence tends to be weaker, and competition stronger, in countries where institutional development is more advanced and external governance mechanisms are strong.
AB - This paper examines the intensity of competition in 65 national banking industries. Country-level dynamic panel estimates of the persistence of bank profit are reported and compared. Persistence of bank profit is interpreted as an indicator of the intensity of competition, and as such is found to be consistent with traditional structure-based and conduct-based competition indicators. Persistence is negatively related to the rate of growth in GDP per capita, and positively related to the size of entry barriers. Persistence tends to be weaker, and competition stronger, in countries where institutional development is more advanced and external governance mechanisms are strong.
U2 - 10.1016/j.jbankfin.2011.03.015
DO - 10.1016/j.jbankfin.2011.03.015
M3 - Article
SN - 0378-4266
VL - 35
SP - 2881
EP - 2890
JO - Journal of Banking & Finance
JF - Journal of Banking & Finance
IS - 11
ER -