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Good institutions and banking sector competitiveness: A semi-parametric evidence

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  • Egbendewe, Aklesso Y.G.
  • Oloufade, Djoulassi K.

Abstract

This research examines the role of institutions’ quality in the competitiveness of the banking sector in developing countries. Hence, semi-parametric regression models are used with bank level detailed panel data from 2000 to 2014 drawn from the West African Economic and Monetary Union (WAEMU) countries. The results suggest that, depending on the types of institutional variables used to condition the proposed dynamic Panzar–Rosse H-statistics, some institutions’ quality variables such as corruption control, government effectiveness, and the rule of law display U-shaped relationships. Efforts in institutions’ quality improvement above certain estimated thresholds are required to enhance banking market competitiveness

Suggested Citation

  • Egbendewe, Aklesso Y.G. & Oloufade, Djoulassi K., 2020. "Good institutions and banking sector competitiveness: A semi-parametric evidence," Finance Research Letters, Elsevier, vol. 36(C).
    • Handle: RePEc:eee:finlet:v:36:y:2020:i:c:s1544612319304076
    DOI: 10.1016/j.frl.2019.101342
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    Cited by:

    1. Marcelin, Isaac & Egbendewe, Aklesso Y.G. & Oloufade, Djoulassi K. & Sun, Wei, 2022. "Financial inclusion, bank ownership, and economy performance: Evidence from developing countries," Finance Research Letters, Elsevier, vol. 46(PA).
    2. Aziz, Saqib & Ashraf, Dawood & El-Khatib, Rwan, 2021. "Societal trust and Sukuk activity," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 74(C).
    3. Egbendewe, Aklesso Y. G. & Yevesse, Dandonougbo, 2022. "Cooking fuels’ choice, women’s health and CO2 emissions in selected rural West African countries," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322481, Agricultural and Applied Economics Association.
    4. Ghulam, Yaseen & Dhruva, Kamini, 2024. "Banking sector reforms in a challenging environment: An emerging financial market experience," International Review of Economics & Finance, Elsevier, vol. 92(C), pages 1074-1096.
    5. Nanivazo, Joelle M. & Egbendewe, Aklesso Y.G. & Marcelin, Isaac & Sun, Wei, 2021. "Foreign bank entry and poverty in Africa: Misaligned incentives?," Finance Research Letters, Elsevier, vol. 43(C).
    6. Umar, Muhammad & Ji, Xiangfeng & Mirza, Nawazish & Rahat, Birjees, 2021. "The impact of resource curse on banking efficiency: Evidence from twelve oil producing countries," Resources Policy, Elsevier, vol. 72(C).

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    More about this item

    Keywords

    Market power; Financial intermediation; Efficient banking markets; Institutions’ quality;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General

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