{"status":"public","_id":"34802","publication_status":"published","doi":"https://doi.org/10.1108/JRF-03-2023-0075","date_created":"2022-12-22T07:28:25Z","user_id":"36049","year":"2024","author":[{"first_name":"Sarah","full_name":"Herwald, Sarah","last_name":"Herwald"},{"full_name":"Voigt, Simone","last_name":"Voigt","first_name":"Simone"},{"orcid":"https://orcid.org/0000-0002-8058-8857","last_name":"Uhde","full_name":"Uhde, André","first_name":"André","id":"36049"}],"citation":{"apa":"Herwald, S., Voigt, S., &#38; Uhde, A. (2024). The conditional impact of market consolidation and market power on banking stability – Evidence from Europe. <i>Journal of Risk Finance</i>. <a href=\"https://doi.org/10.1108/JRF-03-2023-0075\">https://doi.org/10.1108/JRF-03-2023-0075</a>","ieee":"S. Herwald, S. Voigt, and A. Uhde, “The conditional impact of market consolidation and market power on banking stability – Evidence from Europe,” <i>Journal of Risk Finance</i>, 2024, doi: <a href=\"https://doi.org/10.1108/JRF-03-2023-0075\">https://doi.org/10.1108/JRF-03-2023-0075</a>.","bibtex":"@article{Herwald_Voigt_Uhde_2024, title={The conditional impact of market consolidation and market power on banking stability – Evidence from Europe}, DOI={<a href=\"https://doi.org/10.1108/JRF-03-2023-0075\">https://doi.org/10.1108/JRF-03-2023-0075</a>}, journal={Journal of Risk Finance}, author={Herwald, Sarah and Voigt, Simone and Uhde, André}, year={2024} }","ama":"Herwald S, Voigt S, Uhde A. The conditional impact of market consolidation and market power on banking stability – Evidence from Europe. <i>Journal of Risk Finance</i>. Published online 2024. doi:<a href=\"https://doi.org/10.1108/JRF-03-2023-0075\">https://doi.org/10.1108/JRF-03-2023-0075</a>","chicago":"Herwald, Sarah, Simone Voigt, and André Uhde. “The Conditional Impact of Market Consolidation and Market Power on Banking Stability – Evidence from Europe.” <i>Journal of Risk Finance</i>, 2024. <a href=\"https://doi.org/10.1108/JRF-03-2023-0075\">https://doi.org/10.1108/JRF-03-2023-0075</a>.","short":"S. Herwald, S. Voigt, A. Uhde, Journal of Risk Finance (2024).","mla":"Herwald, Sarah, et al. “The Conditional Impact of Market Consolidation and Market Power on Banking Stability – Evidence from Europe.” <i>Journal of Risk Finance</i>, 2024, doi:<a href=\"https://doi.org/10.1108/JRF-03-2023-0075\">https://doi.org/10.1108/JRF-03-2023-0075</a>."},"keyword":["market concentration","market power","banking stability","European banking"],"type":"journal_article","jel":["G15","G21","G38"],"department":[{"_id":"186"},{"_id":"188"}],"language":[{"iso":"eng"}],"date_updated":"2024-04-17T13:34:04Z","title":"The conditional impact of market consolidation and market power on banking stability – Evidence from Europe","abstract":[{"lang":"eng","text":"Purpose\r\nAcademic research has intensively analyzed the relationship between market concentration or market power and banking stability but provides ambiguous results, which are summarized under the concentration-stability/fragility view. We provide empirical evidence that the mixed results are due to the difficulty of identifying reliable variables to measure concentration and market power.\r\n\r\nDesign/methodology/approach\r\nUsing data from 3,943 banks operating in the European Union (EU)-15 between 2013 and 2020, we employ linear regression models on panel data. Banking market concentration is measured by the Herfindahl–Hirschman Index (HHI), and market power is estimated by the product-specific Lerner Indices for the loan and deposit market, respectively.\r\n\r\nFindings\r\nOur analysis reveals a significantly stability-decreasing impact of market concentration (HHI) and a significantly stability-increasing effect of market power (Lerner Indices). In addition, we provide evidence for a weak (or even absent) empirical relationship between the (non)structural measures, challenging the validity of the structure-conduct-performance (SCP) paradigm. Our baseline findings remain robust, especially when controlling for a likely reverse causality.\r\n\r\nOriginality/value\r\nOur results suggest that the HHI may reflect other factors beyond market power that influence banking stability. Thus, banking supervisors and competition authorities should investigate market concentration and market power simultaneously while considering their joint impact on banking stability."}],"publication":"Journal of Risk Finance"}