COMPETITIVE CONDITIONS AMONG THE TURKISH BANKS


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Repkova I., TUFAN E.

5th International Scientific Conference on Finance and the Performance of Firms in Science, Education, and Practice, Zlin, Çek Cumhuriyeti, 28 Nisan 2011, ss.389-399 identifier

  • Cilt numarası:
  • Basıldığı Şehir: Zlin
  • Basıldığı Ülke: Çek Cumhuriyeti
  • Sayfa Sayıları: ss.389-399

Özet

The paper estimates the competitive conditions among the Turkish banks during the period 2002-2009. The Panzar-Rosse model is used for the testing competition in Turkish banking industry. Specifically, we use a panel with data for most of the Turkish banks to estimate the H statistics. We conclude that the Turkish banking industry can be characterized as a monopolistic competition which is close to monopoly. Result implies the Turkish banks do not operate in a competitive environment and enjoy monopoly rents. It can be concluded that competitive conditions were decreasing during the analysed period.

The paper estimates the competitive conditions and concentration in the Turkish banking sector during the period 2002-2009. This paper also reports the results of two common measures of concentration, which are the concentration ratio and the Herfindahl-Hirschman index using Turkish banking system data which cover from 2002 to 2009. We can conclude that the Turkish banking sector is almost non-concentrated. The highest concentration was found in the Turkish deposits market, which it is possible characterize as slightly concentrated. The Panzar-Rosse model is used for testing the competition in the Turkish banking industry. Specifically, we use a panel with data for most of the Turkish banks to estimate the H statistics. We concluded that the Turkish banking industry can be characterized as a monopolistic competition which is close to a monopoly. The result implies the Turkish banks do not operate in a competitive environment and enjoy monopoly rents. It can be concluded that competitive conditions were decreasing during the analysed period.

 

Key words: Turkish banking sector, concentration, concentration ratio, competition, Herfindahl-Hirschman index, Panzar-Rosse model

 JEL codes: D40, G21