Abstract
This paper focusses on the interaction between regulation and competition in a simple industrial organization model. We analyze how regulation affects the profitability of financial institutions. We find that information asymmetries impose a heavy regulatory burden on the higher-quality banks, highlighting the importance of fine-tuning regulation. Our other main results point at the importance of a level playing field.
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© 2000 Springer Science+Business Media New York
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Boot, A.W.A., Deželan, S., Milbourn, T.T. (2000). Regulatory Distortions in a Competitive Financial Services Industry. In: Eisenbeis, R.A., Furlong, F.T., Kwan, S. (eds) Financial Modernization and Regulation. Springer, Boston, MA. https://doi.org/10.1007/978-1-4757-5228-1_11
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DOI: https://doi.org/10.1007/978-1-4757-5228-1_11
Publisher Name: Springer, Boston, MA
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