A comment on "The Effects of Banking Competition on Growth and Financial Stability":I4R Discussion Paper No. 81

Calef, Andrea ORCID: https://orcid.org/0000-0002-7045-2622, Chzhen, Sya In, Mandas, Marco and Motoki, Fabio ORCID: https://orcid.org/0000-0001-7464-3330 (2023) A comment on "The Effects of Banking Competition on Growth and Financial Stability":I4R Discussion Paper No. 81.

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Abstract

Carlson et al. (2022) examine the causal impact of banking competition by investigating a unique circumstance in the National Banking Era of the nineteenth century in the US, where a discontinuity in bank capital requirements occurred. On the one hand, their findings suggest that banks operating in markets with fewer barriers to entry tend to increase their lending activities, promoting real economic growth. On the other hand, banks in less restricted markets also exhibit a higher propensity for risk-taking, posing risks to financial stability. First, we fully reproduce the paper's outcomes apart from a minor discrepancy in the estimate of Table 9 attributed to issues in the provided codes. Second, we test the robustness of the results by (i) changing the ranges used to select the sample of cities included in the analysis, (ii) adopting different options to address outliers' potential issues and (iii) introducing additional control variables. We observe that the estimation results remain mostly consistent when subjecting them to various robustness checks. However, it is worth highlighting that the results can be partially influenced by the criteria used to select the sample of cities and the inclusion of control variables.

Item Type: Article
Uncontrolled Keywords: sdg 8 - decent work and economic growth ,/dk/atira/pure/sustainabledevelopmentgoals/decent_work_and_economic_growth
Faculty \ School: Faculty of Social Sciences > School of Economics
Faculty of Social Sciences
Faculty of Social Sciences > Norwich Business School
UEA Research Groups: Faculty of Social Sciences > Research Groups > Industrial Economics
Faculty of Social Sciences > Research Groups > Applied Econometrics And Finance
Faculty of Social Sciences > Research Centres > Centre for Competition Policy
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Depositing User: LivePure Connector
Date Deposited: 28 Nov 2023 03:03
Last Modified: 28 Nov 2023 03:03
URI: https://ueaeprints.uea.ac.uk/id/eprint/93842
DOI:

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