Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/293881 
Year of Publication: 
2020
Citation: 
[Journal:] Credit and Capital Markets – Kredit und Kapital [ISSN:] 2199-1235 [Volume:] 53 [Issue:] 1 [Year:] 2020 [Pages:] 43-80
Publisher: 
Duncker & Humblot, Berlin
Abstract: 
Economic studies on the degree of competition (DC) in banking systems use various measures which are subsumed under the 1) structure- (e.g. Herfin­dahl-Hirschman index), 2) conduct- (e.g. Boone indicator) or 3) performance-oriented approach (e.g. Lerner index). Yet, the respective empirical operationali­zations of the different DC measures are expected to represent one central construct – the true DC of a banking system. We review 35 studies covering 15 European banking systems from 1998 to 2007. Contrasting the central construct hypothesis, we find substantial differences in the produced DC measures. Thus, the economic validity of derived conclusions regarding the competition intensity is challenged.
Subjects: 
Lerner index
Boone indicator
H statistic
CH3
Competition measurement
Central construct hypothesis
Degree of competition (DC)
SCP paradigm
European banking system
Banking industry
JEL: 
E43
E52
E58
L16
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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