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Macau Periodical Index (澳門期刊論文索引)
- Author
- Ng, San U; Fu, Xiaoqing
- Title
- Market structure and performance in Macau banking
- Journal Name
- Euro Asia Journal of Management
- Pub. Info
- Jun. 2007, Vol.17, No.1, pp. 61-77
- Abstract
- Abstract : This paper studies the relationship between market structure and performance of Macau's banking sector during the 1995-2004 period. The model incorporates measures of concentration, market share, X-efficiency, and scale efficiency into the estimating equation, to test both the market-power and the efficient-structure hypotheses in Macau's banking sector. The empirical results only support the relative-market-power (RMP) hypothesis. The finding implies that the big banks in Macau were able to exert market power in setting prices and earn higher profits. There is no support for any of the efficient-structure hypotheses and the quiet life hypothesis. The major policy lesson is that Macau's banking sector should be closely monitored by the regulatory authorities in terms of antitrust enforcement. Paragraph Headings: 1. Introduction 2. Macau's banking sector 3. Literature review 4. Methodology and data 4.1. Methodology 4.2. Data 5. Empirical results 6. Conclusions Tables: 1. Descriptive statistics of Macau banking sector (1995-2004) 2. Market share of individual banks in 2004 (KPMG, 2005) 3. Market-power vs. efficient-structure: estimation of equation (1) 4. Necessary condition of ES: estimation of equations (2) and (3) 5. The 'quiet-life' hypothesis: estimation of equations (4) and (5)