Assessing bank competition for consumer loans
نویسندگان
چکیده
We assess the competitiveness of the $400 billion dollar U.S. bank consumer loan market by comparing results from different competition measures–HHI, Lerner Index, H-Statistic along with three others, two of which are related to frontier analysis. These measures are typically weakly related to one another and only half of them identify banks with the highest loan price and spread as also being the least competitive. This is the opposite of what would be expected. The most and least competitive banks are not located in the most populous states and the largest banks are underrepresented. Overall, the HHI should not be used to indicate competition.
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