Testing for Competition Among German Banks

By H. Hempell. Social Science Research Network, 2002

175 citations recorded by the source corpus.

Given the marked reduction in the number of banks in Germany during recent years, the study estimates competitive behavior in the German banking system by applying an empirical method developed by Panzar and Rosse (1987). By estimating the banks' reduced form revenue functions, the sums of their estimated factor price elasticities which constitute the so called H-statistics provide information about banks' competitive behavior. Based on the micro data of banks? balance sheets and profit and loss accounts for the years 1993-1998, the hypotheses of perfect collusion as well as of perfect competition can be rejected by means of panel-econometric estimations. For individual categories of banks significant differences were found with respect to savings banks and cooperative banks, on the one hand, and credit banks, on the other, as well as for several size categories. However, despite the decrease in the number of banks in Germany during the investigated period and a slight increase in concentration during that time, there are no clear indications of a different competitive behavior in the second half of the time period under investigation.

Subfields: Accounting, Finance

View Paper: https://www.semanticscholar.org/paper/d8ad3200731e51461a366e766f67a472b100ae63

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Citations in the corpus

Cross-Country Comparisons of Competition and Pricing Power in (2006, unknown): “From left to right, the countries in each figure (denoted as 1 to 14 on the X-axis) are: Belgium, Denmark, France, Germany, Spain, Greece, Italy, Luxembourg, Netherlands, Portugal, UK, Austria, Sweden, and Ireland.”
Market structure and competitive conditions in the Arab GCC banking system (2006, background): “10 See Shaffer (1982) for the origination of this test and more recently for its application Molyneux et al. (1996b); Hondroyiannis et al.”
Bank Competition in the Middle East and Northern Africa Region (2010, background): “1 For studies on the impact of competition see Koskela and Stenbacka (2000), Beck, Demirguc-Kunt and Maksimovic (2004), Beck, Demirguc-Kunt, and Levine (2006), Cetorelli and Strahan (2006), Carletti, Hartmann, and Spagnolo (2007), Schaeck and Cihak (2008), among others.”