Keywords: Market definition, antitrust, banking
Abstract: Antitrust analysis of bank mergers defines banking markets to be
geographically local and to consist of the cluster of financial
products supplied by commercial banks. This definition is based
on assumptions about households' and small businesses' behavior
in purchasing banking services. This article utilizes data from
the Survey of Consumer Finances to examine how households' use
of financial services and institutions changed between 1989 and 1998.
We investigate the extent to which households still focus their
purchases of financial services at local depository institutions,
as opposed to non-depository or distant institutions, and examine
the extent to which purchases are clustered at a single institution.
Overall, the results indicate that households continue, to a
substantial degree, to obtain certain key asset services, notably
checking accounts, at local depository institutions.
Full paper (84 KB PDF)
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Last update: April 26, 2001