IDEAS home Printed from https://ideas.repec.org/h/elg/eechap/16878_3.html
   My bibliography  Save this book chapter

Adapting conjectural variations methods to banking competition

In: Handbook of Competition in Banking and Finance

Author

Listed:
  • Bastiaan Overvest

Abstract

Most economists agree that effective banking competition contributes to affordable and innovative banking services. More controversial is how to measure banking competition. A frequently used approach is the conduct parameter (or conjectural variations) method. Applications of this method make no structural distinction between financial products and non-financial products. Yet financial products such as mortgages, consumer loans and SME loans are quite different from non-financial products – an interest rate is not “the†price of a loan. The chapter adjusts the conjectural variations model to a net present value setting to explicitly take characteristics of financial products into account. It shows that the adjusted method tends to yield lower estimates of the degree of competition than the standard static non-financial method. The question of how to reliably measure banking competition remains open.

Suggested Citation

  • Bastiaan Overvest, 2017. "Adapting conjectural variations methods to banking competition," Chapters, in: Jacob A. Bikker & Laura Spierdijk (ed.), Handbook of Competition in Banking and Finance, chapter 3, pages 46-51, Edward Elgar Publishing.
    • Handle: RePEc:elg:eechap:16878_3
    as

    Download full text from publisher

    File URL: https://www.elgaronline.com/view/9781785363290.00009.xml
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Economics and Finance;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:elg:eechap:16878_3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Darrel McCalla (email available below). General contact details of provider: http://www.e-elgar.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.