The Impact of Market Concentration and Competition on Profitability in Banking Industry A Study on Commercial Banks in Ethiopia

Abstract

quotThis study investigates market concentration and competition and profitability in the newlineEthiopian banking industry over those critical years (2010-2006). The study uses a newlinestructural (the SCP) and not structural market approach (the Panzar-Rosse) to measure newlinethe degree of competitiveness based on quantitative studies is adopted to form a causal newlinelink among different extraneous and firm specific factors variables with bank newlineperformance. The basic objective of this research is to test the validity of this view. A newlineSCP analysis has been undertaken so as to examine whether the level of concentration newlineinfluences performance of Ethiopian Banks. In addition, it aims at investigating the newlinedegree of market competitions using non-structure approach, panzar Rosse model and newlinetheir impact on performances with an overarching purpose of exploring a comprehensive newlinemodel of bank performances.quot newline newline