A New Data Set on Competition in National Banking Markets

44 Pages Posted: 13 Jun 2014

See all articles by Sofronis Clerides

Sofronis Clerides

University of Cyprus; Centre for Economic Policy Research (CEPR); University of Bologna - Rimini Center for Economic Analysis (RCEA)

Manthos D. Delis

Audencia Business School

Sotirios Kokas

University of Essex - Essex Business School

Date Written: June 2014

Abstract

We estimate the degree of competition in the banking sectors of 148 countries over the period 1997-2010 using three methods: the Lerner index, the adjusted Lerner index, and the profit elasticity. Marginal cost estimates required for all methods are obtained using a flexible semi-parametric methodology. All three indices show that competitive conditions in banking deteriorated during the period 1997-2006, improved until 2008, and deteriorated again thereafter. Levels of competition differ across regions and income groups, but there is gradual convergence over time. Banking systems in less competitive sub-Saharan Africa and low income countries and more competitive in Europe and Central and South Asia and OECD countries.

Keywords: bank competition, Lerner index, profit elasticity

JEL Classification: G21

Suggested Citation

Clerides, Sofronis and Delis, Manthos D. and Kokas, Sotirios, A New Data Set on Competition in National Banking Markets (June 2014). Available at SSRN: https://ssrn.com/abstract=2448938 or http://dx.doi.org/10.2139/ssrn.2448938

Sofronis Clerides

University of Cyprus ( email )

75 Kallipoleos Street
P.O. Box 20537
1678 Nicosia
Cyprus
+357 2289 3709 (Phone)
+357 2289 5049 (Fax)

HOME PAGE: http://sofronis.clerides.com

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

University of Bologna - Rimini Center for Economic Analysis (RCEA) ( email )

Via Patara, 3
Rimini (RN), RN 47900
Italy

Manthos D. Delis

Audencia Business School ( email )

8 Road Joneliere
BP 31222
Nantes Cedex 3, 44312
France

Sotirios Kokas (Contact Author)

University of Essex - Essex Business School ( email )

Wivenhoe Park
Colchester, CO4 3SQ
United Kingdom

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