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Rivalidad por clientes en el mercado cambiario venezolano
[Rivalry for customers in the Venezuelan exchange market]

Author

Listed:
  • Pedauga, Luis
  • Pineda, Julio
  • Miguel, Dorta

Abstract

We try to establish which is the structure that best defines the venezuelan foreign exchange market. Asking ourselves whether there exist a group of agents able to exert market power. We assume that the flow of currency between banks follows a first order stochastic Markov process of first order, in which competition is understood as a dynamic process of rivalry for trading the largest volume of currency under free convertibility. We use daily aggregate currency flows across banks to estimate probabilities of transition, which can be interpreted as approximations to the degree of rivalry between banks. In addition competition for currencies transactions was studied in a dynamic way.

Suggested Citation

  • Pedauga, Luis & Pineda, Julio & Miguel, Dorta, 2004. "Rivalidad por clientes en el mercado cambiario venezolano [Rivalry for customers in the Venezuelan exchange market]," MPRA Paper 62431, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:62431
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    References listed on IDEAS

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    1. Bresnahan, Timothy F & Schmalensee, Richard, 1987. "The Empirical Renaissance in Industrial Economics: An Overview," Journal of Industrial Economics, Wiley Blackwell, vol. 35(4), pages 371-378, June.
    2. Gilbert, R Alton, 1984. "Bank Market Structure and Competition: A Survey," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 16(4), pages 617-644, November.
    3. Rogers, Richard T., 1985. "A Structure- Price- Cost Margin Model Estimated Over Time Food and Tobacco Product Classes, 1954 to 1977," Working Papers 202999, University of Wisconsin-Madison, Department of Agricultural and Applied Economics, Food System Research Group.
    4. Alain Chaboud & Steven Weinberg, 2002. "Foreign exchange markets in the 1990s: intraday market volatility and the growth of electronic trading," BIS Papers chapters, in: Bank for International Settlements (ed.), Market functioning and central bank policy, volume 12, pages 138-147, Bank for International Settlements.
    5. MacRae, Elizabeth Chase, 1977. "Estimation of Time-Varying Markov Processes with Aggregate Data," Econometrica, Econometric Society, vol. 45(1), pages 183-198, January.
    6. Bresnahan, Timothy F., 1989. "Empirical studies of industries with market power," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 17, pages 1011-1057, Elsevier.
    7. Rojas, Mariano, 1997. "Competencia por clientes en la industria bancaria de México," El Trimestre Económico, Fondo de Cultura Económica, vol. 64(253), pages 47-73, enero-mar.
    8. R. Cesari, 1994. "A generalized measure of competition," Working Papers 204, Dipartimento Scienze Economiche, Universita' di Bologna.
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    Cited by:

    1. Hernando Vargas & Rocío Betnacourt, 2006. "Pension Fund Managers Behavior In The Foreign Exchange Market," Borradores de Economia 391, Banco de la Republica de Colombia.

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    More about this item

    Keywords

    Measure of competition; rivalry; markov chains; foreign exchange markets;
    All these keywords.

    JEL classification:

    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • L8 - Industrial Organization - - Industry Studies: Services

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