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Softening Competition by Enhancing Entry: An Example from the Banking Industry

Bouckaert, Jan; Degryse, Hans - Centro Studi di Economia e Finanza (CSEF) - 2002

We show that competing firms relax overall competition by lowering future barriers to entry. We illustrate our findings in a two-period model with adverse selection where banks strategically commit to disclose borrower information. By doing this, they invite rivals to enter their market....

Persistent link: https://www.econbiz.de/10005802037

Distance, Lending Relationships, and Competition

Degryse, Hans; Ongena, Steven - Centro Studi di Economia e Finanza (CSEF) - 2002

effect on loan conditions of the geographical distance between firms, the lending bank, and all other banks in the vicinity …. For our study, we employ detailed contract information from more than 15,000 bank loans to small firms and control for … relevant relationship, loan contract, bank branch, firm, and regional characteristics. We report the first comprehensive …

Persistent link: https://www.econbiz.de/10005802043

Entry and Strategic Information Display in Credit Markets

Bouckaert, Jan; Degryse, Hans - Centro Studi di Economia e Finanza (CSEF) - 2002

The Riegle-Neal Act in the US and the Economic and Monetary Union in Europe are recent initiatives to stimulate financial integration. These initiatives allow new entrants to "poach" the incumbents' clients by offering them attractive loan offers. We show that these deregulations may be...

Persistent link: https://www.econbiz.de/10005802057