Market structure and quality
Subtitle: an application to the banking industry
By: Astrid A. Dick.
Series: Finance and economics discussion series ;; 2003-14; Finance and economics discussion series (Online) ;; 2003-14.
Publisher: Federal Reserve Board
Published: 2003
Place of publication: Washington, D.C
Language: eng
Format: Electronic resource
Subjects: Bank mergers -- United States.; Banks and banking -- United States.; Industrial organization (Economic theory)
Description: "This paper presents empirical evidence consistent with the predictions of the endogenous sunk cost model of Sutton (1991), with an application to banks.  In particular, banking markets remain concentrated regardless of market size.  Given an asymmetric oligopoly where dominant and fringe firms coexist, the number of dominant banks remains unchanged with market size, with only the number of fringe banks varying across markets.  Such structure is sustained by competitive investments in quality, with the level of quality increasing with market size and dominant banks providing higher quality than fringe banks.  The analysis has implications for antitrust policy"--Federal Reserve Board web site.
Notes: Includes bibliographical references.
Title from PDF file as viewed on 7/28/2004.
Also available in print.
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Mode of access: World Wide Web.