Assessing competition using the Panzar-Rosse model on the Philippine banking industry
Date
2017-06
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
This paper is an application to the Philippine case of the Panzar-Rosse model, a widely used and accepted
measure of competitive conduct, particularly in the banking industry, with several and varied representative
variables on input costs, scale, bank-specific and other important factors. Referring to the variables and results of
several international and local studies, the researchers identified and tested three input costs, and three bank-
specific factors. The latter variables were tested individually rather than as a group as done in several other studies.
The H-statistic was obtained by getting the sum of the coefficients of the input costs, after which a Wald test was
conducted to validate the significance of the results. structure. Based on the data and evidence used in this study,
the Philippine banking industry can be characterized as monopolistically competitive.
Description
Keywords
Panzar-Rosse model, Banking industry