Market power versus efficient-structure in Arab GCC banking

Saeed Al-Muharrami; Kent Matthews

doi:10.1080/09603100902845478

Market power versus efficient-structure in Arab GCC banking

Saeed Al-Muharrami
, Kent Matthews^*

^*Corresponding author for this work

Research output: Journal Publication › Article › peer-review

55 Citations (Scopus)

Abstract

This article evaluates the performance of the Arab Gulf Cooperation Council (GCC) banking industry in the context of the Structure-Conduct-Performance (SCP) hypothesis in the period 1993 to 2002. This article uses panel estimation differentiating between bank fixed effects and country fixed effects. It examines the Relative-Market-Power (RMP) and the Efficient-Structure (ES) hypotheses differentiating between the two by employing a nonparametric measure of technical efficiency, and finds that the banking industry in the Arab GCC countries is best explained by the mainstream SCP hypothesis. The empirical results do not find any support for the Hicks' (1935) 'Quiet Life' (QL) version of the market power hypothesis.

Original language	English
Pages (from-to)	1487-1496
Number of pages	10
Journal	Applied Financial Economics
Volume	19
Issue number	18
DOIs	https://doi.org/10.1080/09603100902845478
Publication status	Published - Sept 2009
Externally published	Yes

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 17 Partnerships for the Goals

ASJC Scopus subject areas

Finance
Economics and Econometrics

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10.1080/09603100902845478

Cite this

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abstract = "This article evaluates the performance of the Arab Gulf Cooperation Council (GCC) banking industry in the context of the Structure-Conduct-Performance (SCP) hypothesis in the period 1993 to 2002. This article uses panel estimation differentiating between bank fixed effects and country fixed effects. It examines the Relative-Market-Power (RMP) and the Efficient-Structure (ES) hypotheses differentiating between the two by employing a nonparametric measure of technical efficiency, and finds that the banking industry in the Arab GCC countries is best explained by the mainstream SCP hypothesis. The empirical results do not find any support for the Hicks' (1935) 'Quiet Life' (QL) version of the market power hypothesis.",

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AB - This article evaluates the performance of the Arab Gulf Cooperation Council (GCC) banking industry in the context of the Structure-Conduct-Performance (SCP) hypothesis in the period 1993 to 2002. This article uses panel estimation differentiating between bank fixed effects and country fixed effects. It examines the Relative-Market-Power (RMP) and the Efficient-Structure (ES) hypotheses differentiating between the two by employing a nonparametric measure of technical efficiency, and finds that the banking industry in the Arab GCC countries is best explained by the mainstream SCP hypothesis. The empirical results do not find any support for the Hicks' (1935) 'Quiet Life' (QL) version of the market power hypothesis.

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Market power versus efficient-structure in Arab GCC banking

Abstract

UN SDGs

ASJC Scopus subject areas

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