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Explaining The Market Power Of Ghanaian Banks1

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Listed:
  • Q.q. Anthony Aboagye
  • S.k. Akoena
  • T.o. Antwi‐asare
  • A.f. Gockel

Abstract

A competitive banking system helps lower transaction costs and risks. It also helps make financial markets more efficient. In Ghana however, observers believe that the banking industry is not competitive and point to the huge spread between bank lending and borrowing rates as evidence. The Ghanaian banking industry is analysed for evidence of market power by computing the Lerner Index of banks using quarterly data from 2001 to 2006. The evidence is that Ghanaian banks possess market power. Factors that significantly explain the market power of Ghanaian banks are: bank size, efficiency of banks with respect to staff costs, the macroeconomic environment and time.

Suggested Citation

  • Q.q. Anthony Aboagye & S.k. Akoena & T.o. Antwi‐asare & A.f. Gockel, 2008. "Explaining The Market Power Of Ghanaian Banks1," South African Journal of Economics, Economic Society of South Africa, vol. 76(4), pages 569-585, December.
    • Handle: RePEc:bla:sajeco:v:76:y:2008:i:4:p:569-585
    DOI: 10.1111/j.1813-6982.2008.00221.x
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    References listed on IDEAS

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    Cited by:

    1. Anthony M. Simpasa, 2013. "Working Paper 168 - Competition and Market Structure in the Zambian Banking Sector," Working Paper Series 447, African Development Bank.
    2. Simpasa, Anthony, 2010. "Characterising market power and its determinants in the Zambian banking indudstry," MPRA Paper 27232, University Library of Munich, Germany.
    3. Nguyen, My & Perera, Shrimal & Skully, Michael, 2016. "Bank market power, ownership, regional presence and revenue diversification: Evidence from Africa," Emerging Markets Review, Elsevier, vol. 27(C), pages 36-62.
    4. Kouki, Imen & Al-Nasser, Amjad, 2017. "The implication of banking competition: Evidence from African countries," Research in International Business and Finance, Elsevier, vol. 39(PB), pages 878-895.

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