Iranian Journal of Economic Research

Market Structure in Iran's Banking Sector: An Application of Multilevel Models

Authors

Atousa Goudarzi 1
Afsaneh Shafiee 2

1 Associate Professor, ECO College of Insurance, Allameh Tabatabai University

2 Senior Researcher, Institute for Trade Studies and Research, Ministry of Commerce

Abstract
This paper analyzes Iran's banking market structure, using unbalanced panel data models during 1997-2009. To study the market structure, various measures of market concentration are examined theoretically and the U index of concentration is applied to Iran's banking system. The results show that, along with the commencement of privatization in Iran's banking sector (2001), U index of concentration has tended to decrease, indicating that competition in Iran's banking market has intensified. However, this may not happen until the strict regulations on private banks are relaxed.
 

Keywords

market structure
Cost Function
Banking Industry
Multi-level Models
Iran's Banking Sector

  • Receive Date 19 April 2016
  • First Publish Date 19 April 2016

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