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Int J Fin Econ - 2023 - Glass - Returns to scale spillovers and persistence A network perspective of U S bank size (1).pdf (1.72 MB)

Returns to scale, spillovers and persistence: a network perspective of U.S. bank size

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journal contribution
posted on 2024-04-19, 12:50 authored by Anthony Glass, Karligash GlassKarligash Glass

The methods for ray-scale economies (RSE) and expansion-path scale economies (EPSE) are extended to the dynamic spatial setting. We apply these methods to large U.S. banks using dynamic spatial cost and revenue models and key findings include the following. First, accounting for spillovers and dynamics strengthens the case for EPSE over RSE. Second, own, spillover and total EPSE are very persistent in future periods. Third, the EPSE suggest that an appropriate regulatory size cap would shift one systemically important bank to its contemporaneous optimal scale. However, the EPSE suggest that this would be a sub-optimal dynamic scale in future periods.

History

School

  • Loughborough Business School

Published in

International Journal of Finance and Economics

Volume

29

Issue

2

Pages

2049-2076

Publisher

Wiley

Version

  • VoR (Version of Record)

Rights holder

© The Authors

Publisher statement

This is an Open Access Article. It is published by Wiley under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Licence (CC BY-NC-ND). Full details of this licence are available at: https://creativecommons.org/licenses/by-nc-nd/4.0/

Acceptance date

2022-12-17

Publication date

2023-01-09

Copyright date

2023

ISSN

1076-9307

eISSN

1099-1158

Language

  • en

Depositor

Prof Karligash Glass. Deposit date: 28 December 2022

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