This paper discusses the research agenda on optimal bank productive efficiency and industrial structure. One goal of … this agenda is to answer some fundamental questions in financial industry restructuring, such as what motivates bank … an empirical question. The paper reviews the recent literature, including techniques for modeling bank production and the …

are regulated, including the need to obtain a charter to operate and explicit and implicit federal guarantees of bank … liabilities to reduce the probability of bank runs. These aspects of banking affect a bankś choice of risk vs. expected return …, which, in turn, affects bank performance. Banks have an incentive to reduce risk to protect the valuable charter from …

portfolio production that was estimated for a sample of highest-level U.S. bank holding companies in Hughes, Lang, Mester, and … experience clear gains in their financial performance, but society also benefits from the enhanced bank safety that follows from …

method, and a number of bank, market, and regulatory characteristics. We review the existing literature and provide new …