Bank Market Structure and Local Employment Growth

by Robert Collender and Sherrill L. Shaffer

Bank Market Structure and Local Employment Growth examines the relationship between measures of local bank market structure (such as the level of geographic regulation, market concentration, nonlocal bank ownership, nonlocal control of local bank deposits, and bank market concentration) and job growth is using both longrun and shortrun empirical models. Although our shortrun model provides evidence of a robust relationship between local employment growth and geographic deregulation of bank activity in the United States, overall we found only weak evidence in support of an employment growth channel linking bank structure to subsequent economic growth.

Keywords: banking, employment, bank regulation, bank ownership

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