Effet Du Pouvoir De Marché Sur La Prise De Risque Bancaire En Zone Cemac

Mela Christel; Abessolo Yves André; Bita Charles-Alain

Authors

Mela Christel
Abessolo Yves André
Bita Charles-Alain

Keywords:

market power, stability, concentration ratio (CR3), boone indicator, z-score

Abstract

This article assesses the effect of market power on Bank Risk Taking in the CEMAC zone for the period 2000-2016. Competition is approximated by a structural indicator (concentration ratio) and a non-structural indicator (Boone indicator). Bank stability is measured by z-score. Estimations by the generalised method of moments show that when the relationship between competition and banking stability is assumed to be linear, the results support the competition-fragility or concentration-stability thesis. However, the test of non-linearity by introducing the quadratic term of the measure of competition indicator in the model shows that there is a threshold beyond which an increase in market power (less competition) could begin to harm stability. Thus, before taking action on competition in the CEMAC, regulatory authorities must consider this non-linear relationship between banking stability and competition.

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How to Cite

Effet Du Pouvoir De Marché Sur La Prise De Risque Bancaire En Zone Cemac. (2020). Global Journal of Human-Social Science, 20(E1), 1-13. https://socialscienceresearch.org/index.php/GJHSS/article/view/102009

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