This paper investigates the impact of monetary policy on the optimal bank behavior under oligopolistic conditions. In addition, we attempt to extend this analysis in the sphere of bank-clients behavior.We concentrate on the way the minimum reserve requirements of commercial banks influence the...

Using a two-stage Cournot game with economies of scope, we examine the effects of monetary policy on the optimal bank behavior. Emphasis is on the way the interest rate spread is influenced by the minimum reserve requirements. It is demonstrated that the sign of this effect depends on the kind...