Market Share Quotas and Community Reinvestment.
This notes explores some theoretical implications of the U.S. Department of Justice's policy requiring lenders to seek as much market share in protected neighborhoods as elsewhere. In the asymmetric Cournot case, the high-cost lender in the protected neighborhood responds in the expected way, but the low-cost lender's response depends on the curvature of the demand function. For concave demand, the low-cost lender's output decisions run counter to those of the high-cost lender, undermining the policy's effectiveness and inefficiently shifting production in the protected market from the low-cost provider to the high-cost provider. Copyright 1998 by Kluwer Academic Publishers
Year of publication: |
1998
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Authors: | Shaffer, Sherrill |
Published in: |
Journal of Regulatory Economics. - Springer. - Vol. 14.1998, 1, p. 75-78
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Publisher: |
Springer |
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