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A Peer-reviewed scientific articles/A1 Journal article (refereed), original research
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Switching costs and financial stability, Journal of Financial Stability April (2019). Stenbacka, Rune; Takalo, Tuomas

Category A Peer-reviewed scientific articles
Sub-category A1 Journal article (refereed), original research
auki Internal authors
All authors as text Stenbacka, Rune; Takalo, Tuomas 
Number of authors
Status Published
Year of publication 2019 
Date 04.03.2019 
Name of article Switching costs and financial stability 
Name of journal Journal of Financial Stability
Volume of issue 41 
Number of issue April 
Pages 14-24 
Abstract We establish that the effect of intensified deposit market competition, measured by reduced switching costs, on the probability of bank failures depends critically on whether we focus on competition with established customer relationships or competition for the formation of such relationships. With inherited customer relationships, intensified competition due to lower switching costs destabilizes the banking market, whereas it stabilizes the market if we focus on competition for the formation of customer relationships. We characterize the factors important for evaluating the effects of intensified competition on stability in a market with unattached as well as locked-in depositors.
Free text descriptor in Finnish kilpailu; talletukset; kustannukset; pankit; pankkitoiminta; talletusmarkkinakilpailu; rahoitusvakaus; pankin vararikko; siirtymiskustannukset; kilpailun ja vakauden välinen ristiriita 
Free text descriptor in English Deposit market competition; Financial stability; Bank failures; Switching cost; Competition versus stability tradeoff 
JEL-codes G21; D43 
ISSN / e-ISSN 1572-3089 
auki Internet addresses
Additional information Available online 31 January 2019.
Notes BoF DP 2/2016 

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