Traditional bank competition policy seeks to balance efficiency with incentives to take risk. The main tools are rules … seek to affect the degree of competition by focusing on market structure (i.e. concentration) may have limited effect. We … argue that bank competition policy should be reoriented to deal with the too-big-to-fail (TBTF) problem. It should also …

smaller bank size. Overall, we find that concentrated market structures and lack of competition in LICs banking systems and … provide strong evidence that policies aimed at fostering banking competition and strengthening institutional frameworks can …