Competition, product differentiation and quality provision
Subtitle: an empirical equilibrium analysis of bank branching decisions
By: Andrew Cohen and Michael J. Mazzeo.
Contributors: Mazzeo, Michael.
Series: Finance and economics discussion series ;; 2004-46; Finance and economics discussion series (Online) ;; 2004-46.
Publisher: Federal Reserve Board
Published: 2004
Place of publication: Washington, D.C
Language: eng
Format: Electronic resource
Description: "We analyze the effects of market structure on the branching decisions of three types of depository institution: multimarket banks, single-market banks, and thrift institutions.  We argue that additional branches increase quality for an institution's consumers, and examine the interaction between market structure and this particular measure of quality.  We account for endogenous market structure using an equilibrium structural model, which corrects for bias caused by correlation in the unobservables that may drive entry and branching activity.  We estimate the model using data from over 1,750 concentrated rural markets.  Our results demonstrate the importance of product differentiation, as competition from multimarket banks is associated with denser branch networks for all types of firm while the opposite correlation holds when competitors are single-market banks or thrifts"--Federal Reserve Board web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 8/31/2004.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.