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Testing the Structure-Conduct-Performance Paradigm for the Turkish Banking Sector: 2008-2013

Author

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  • Tuncay elik

    (School of Applied Sciences, Erciyes University, Kayseri, Turkey)

  • Muhittin Kaplan

    (Faculty of Economics, Istanbul University, Istanbul, Turkey.)

Abstract

The history of the studies on traditional industrial economics goes back to 1940's. These studies (Mason, 1939; Bain, 1951) were in general conducted to provide information about market structure. The structure-conduct-performance (SCP) approach stemmed from these studies argues that, in the case of hindered market entry, the higher the concentration ratio and collusion among firms, the lower the level of competition in the market. Later on, a number of authors have contributed to the traditional SCP approach to improve it in a number of ways: The first hypothesis is called the collusion hypothesis and developed by Bain (1952); the second one was due to Demsetz (1973) and called the efficient structure hypothesis. This study aims at testing the applicability of the SCP approaches using the data related to 23 Turkish commercial banks operating over the period 2008-2013. The empirical results have shown that the modified efficient structure hypothesis holds for the Turkish banking sector over the sample period.

Suggested Citation

  • Tuncay elik & Muhittin Kaplan, 2016. "Testing the Structure-Conduct-Performance Paradigm for the Turkish Banking Sector: 2008-2013," International Journal of Economics and Financial Issues, Econjournals, vol. 6(4), pages 1625-1631.
    • Handle: RePEc:eco:journ1:2016-04-44
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    References listed on IDEAS

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    Cited by:

    1. Le, Huong Nguyen Quynh & Nguyen, Thai Vu Hong & Schinckus, Christophe, 2021. "Bank efficiency, market structure and strategic interaction: Evidence from Vietnam," Research in International Business and Finance, Elsevier, vol. 56(C).

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    More about this item

    Keywords

    Structure-Conduct-Performance; Efficiency; Concentration; Turkish Banking;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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