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A Tobit Analysis of Determinants of Geographic Differentials in the Commercial Bank Closing Rate in the United States

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Listed:
  • Cebula, Richard
  • Barth, James
  • Belton, Willie

Abstract

This study empirically identifies factors that influenced geographic differentials in the bank closing rate in the United States over the period 1982 through 1990. Given the presence of censored data, the model adopts the tobit estimation procedure. The bank closing rate in a state is found to be an increasing function of the average commercial bank cost of deposits, the percent of gross state product that derives from oil and natural gas extraction, net charge-offs as a percent of outstanding loans, and the presence of unit banking legislation in the state. The bank closing rate is also found to be a decreasing function the inflation rate of housing.

Suggested Citation

  • Cebula, Richard & Barth, James & Belton, Willie, 1994. "A Tobit Analysis of Determinants of Geographic Differentials in the Commercial Bank Closing Rate in the United States," MPRA Paper 51513, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:51513
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    References listed on IDEAS

    as
    1. Cebula, Richard, 1992. "The Impact of Federal Deposit Insurance on Savings and Loan Failures," MPRA Paper 51540, University Library of Munich, Germany.
    2. James R. Barth, 1991. "The Great Savings and Loan Debacle," Books, American Enterprise Institute, number 918256, September.
    3. Jaffee, Dwight M, 1989. "Symposium on Federal Deposit Insurance for S&L Institutions," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 3-9, Fall.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    financial economics; bank closing rate; average cost of deposits; oil and natural gas extraction; net charge-offs;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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