Lucchetta, Marcella; Nicoló, Gianni De - International Monetary Fund (IMF) - 2011
, or is relatively inefficient, then imperfect competition and intermediate levels of bank risks are optimal. These results … technology exhibits increasing returns to scale, or it is relatively efficient, then perfect competition is optimal and supports … the lowest feasible level of bank risk. Conversely, if the intermediation technology exhibits constant returns to scale …