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Title:Market Structure, Scale Efficiency, and Risk as Determinants of German Banking Profitability PDF Logo
Authors:Yu, Peiyi
Neus, Werner
Issue Date:2005
Series/Report no.:Tübinger Diskussionsbeiträge 294
Abstract:The Scale-Efficiency version of the Efficient-Structure Hypothesis and the Structure-Conduct-Performance Hypothesis find empirical support in German banking data from 1998 to 2002. Due to the acceptance of the two hypotheses and the existence of overall economies of scale, we conclude that German banks may improve their profitability by increasing their asset size and/or by consolidation. The increased banking profitability will not only come from monopolistic power (higher concentration rate) but also from the scale efficiency benefit. We also find that portfolio risk is a key factor in determining the profit-structure relationship.
Subjects:Profit-structure relationship
Market Structure
Scale efficiency
Portfolio Risk
JEL:L11
G14
G21
C33
Persistent Identifier of the first edition:urn:nbn:de:bsz:21-opus-17875
Document Type:Working Paper
Appears in Collections:Tübinger Diskussionsbeiträge, Universität Tübingen

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