Bank Concentration and Product Market Competition

Autor:	Daniel Streitz, Farzad Saidi
Rok vydání:	2021
Předmět:	Economics and Econometrics 050208 finance Strategic complements Product market 05 social sciences Monetary economics Competition (economics) Loan Accounting 0502 economics and business Business 050207 economics Market share Finance Externality
Zdroj:	The Review of Financial Studies. 34:4999-5035
ISSN:	1465-7368 0893-9454
DOI:	10.1093/rfs/hhab005
Popis:	This paper documents a link between bank concentration and markups in nonfinancial sectors. We exploit concentration-increasing bank mergers and variation in banks’ market shares across industries and show that higher credit concentration is associated with higher markups and that high-market-share lenders charge lower loan rates. We argue that this is due to the greater incidence of competing firms sharing common lenders that induce less aggressive product market behavior among their borrowers, thereby internalizing potential adverse effects of higher rates. Consistent with our conjecture, the effect is stronger in industries with competition in strategic substitutes where negative product market externalities are greatest.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_dedup___::9b6a7bbafbb77a5a4bf15619eb6b9522 https://doi.org/10.1093/rfs/hhab005 Zobrazit plný text záznamu Plný text ve formátu PDF