Browsing by Subject "vaihtokustannukset"

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  • Ho, Chun-Yu (2014)
    BOFIT Discussion Papers 9/2014
    Published in International Economic Review, Volume 56, Issue 3, 1 August 2015: 723-749
    This paper develops and estimates a dynamic model of consumer demand for deposits in which banks provide differentiated products and product characteristics that evolve over time. Existing consumers are forward-looking and incur a fixed cost for switching banks, whereas incoming consumers are forward-looking but do not incur any cost for joining a bank. The main finding is that consumers prefer banks with more employees and branches. The switching cost is approximately 0.8% of the deposit's value, which leads the static model to bias the demand estimates. The dynamic model shows that the price elasticity over a long time horizon is substantially larger than the same elasticity over a short time horizon. Counterfactual experiments with a dynamic monopoly show that reducing the switching cost has a comparable competitive effect on bank pricing as a result of reducing the dominant position of the monopoly. Keywords: banks in China, demand estimation, switching cost. JEL classifications: G21, L10
  • Takalo, Tuomas (2020)
    Journal of the Finnish Economic Association 1
    Published in BoF DP 15/2019 http://urn.fi/URN:NBN:fi:bof-201909061438
    I calibrate switching cost for the Finnish retail deposit market by using the approach developed by Oz Shy (2002). It turns out that switching costs faced by deposit customers of the main Finnish banks manifest large variation and are high, ranging from 200 euros to nearly 1,400 euros. Over a 20-year period, switching costs have increased by roughly 50% in real terms, but in relation to average account balance, switching costs have not essentially changed. Changes and differences in the banks’ competitive strategies might explain the variation in switching costs across time and banks.
  • Takalo, Tuomas (2019)
    Bank of Finland Research Discussion Papers 15/2019
    Published in Journal of the Finnish Economic Association 2020 ; 1 https://www.taloustieteellinenyhdistys.fi/journal-of-finnish-economic-association-1-2020/
    I calibrate switching cost for the Finnish retail deposit market by using the approach developed by Oz Shy (2002). It turns out that switching costs faced by deposit customers of the main banks are high, ranging from 200 euros to nearly 1,400 euros. Over the past 20 years, switching costs have increased by roughly 50% in real terms, but in relation to average account balance, switching costs have not essentially changed. I conjecture that differences in the switching costs among the Finnish banks might be explained by differences in their loyalty programs.