Bank Competition and Risk-Taking Under Market Integration

• 成果类型: Article; Early Access
• 署名作者: Dam, Kaniska; Sengupta, Rajdeep
• 署名单位: Centro de Investigacion y Docencia Economicas A.C. (CIDE); Federal Reserve System - USA
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2022.03495
• 发表日期: 2024
• 关键词: Bank competition; deregulation; Risk-shifting; market integration

摘要

Linkages between bank competition and risk-taking are analyzed in a model where market integration is the principal driver of increased competition. Risk implications of across-market competition under banking market integration are significantly different from that of within-market competition. Although both modes of competition increase the number of competitor banks, across-market competition yields a bank-customer effect that can potentially reverse any relation that prevails between within-market competition and risk-taking. This result suggests that the lack of consensus in the bank competitionfinancial stability literature is not an anomaly but an inherent feature of the analysis.