Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/78251 
Year of Publication: 
1997
Series/Report no.: 
Thünen-Series of Applied Economic Theory - Working Paper No. 05
Publisher: 
Universität Rostock, Institut für Volkswirtschaftslehre, Rostock
Abstract: 
Since 1994, the German banking market is confronted with an entry wave of direct banks. This banking innovation may be explained by developments on the supply side as well as on the demand side. It is pushed by developments in telecommunication technologies during a period of rising cost competition and pulled by a change in the demand for selling efforts by banks. Within a model of monopolistic competition with endogenous selling efforts we show that in the long run, a direct banking market supports a larger number of firms which offer their products at lower prices than a branch banking market. If customers are heterogeneous, both banking types will survive.
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.