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| Author: | Gonzalez-Maestre, M. Granero, L.M. |
| Title: | Industrial loans and market structure |
| Journal: | European Economic Review
2003 : OCT, VOL. 47:5, p. 841-855 |
| Index terms: | Banking Finance Organizations Industries Loans Markets |
| Language: | eng |
| Abstract: | Based on the observation that financing is one of the main obstacles to create new firms, this paper deals with the interactions btw. the market structure of both the banking sector and the borrowing industries. The paper considers that firmsÂ’ installation costs are financed by means of industrial loans from specialized banks. With endogenous entry in banking activity as well as in the borrowing industry, it is found that a natural oligopoly emerges in both sectors if the entry cost in the industrial sector is small enough, relative to the banksÂ’ entry cost. |
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