An anomaly in the pricing of bank non-interest mortgage charges

A monopolistically competitive model is used to study the determinants of bank mortgage charges. The study shows that concentration and the loan-price ratio do not have significant effects on the bank mortgage charges. Significantly, the charges are found to be positively related to the number of ba...

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Bibliographic Details
Published in:Journal of economics and finance 1999-07, Vol.23 (2), p.162-169
Main Author: Hung, Chao-shun
Format: Article
Language:English
Subjects:
Banks
Competition
Consumers
Economic models
Economic theory
Fees & charges
Hypotheses
Interest rates
Monopolies
Mortgages
Population
Prices
Small business loans
Studies
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Summary:A monopolistically competitive model is used to study the determinants of bank mortgage charges. The study shows that concentration and the loan-price ratio do not have significant effects on the bank mortgage charges. Significantly, the charges are found to be positively related to the number of banks and bank offices in a given market and inversely related to the market size or population.
ISSN:1055-0925
1938-9744
DOI:10.1007/BF02745950