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Information technology and long term trends of financial services supply

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  • Alexandre Rands Barros

Abstract

There are two observed trends in the structure of financial institutions. The first one is consolidation, which leads to inter-firm concentration and the second one is the regional dispersion of their output. Both phenomena are often seen as consequences of development in the technology of information. This paper studies this relationship, theoretically and empirically, and shows that the likely impact of such development actually leads to regional dispersion, as seen in the data, and also to the reduction of inter-firm concentration. The major determinant for this impact is the market power of firms. Although there is not sufficient data to generate any strong conclusion, empirical results support the theoretical hypothesis, forwarded by the model presented in the paper.

Suggested Citation

  • Alexandre Rands Barros, 2004. "Information technology and long term trends of financial services supply," Global Business and Economics Review, Inderscience Enterprises Ltd, vol. 6(1), pages 149-170.
    • Handle: RePEc:ids:gbusec:v:6:y:2004:i:1:p:149-170
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