Banks as ‘fat cats’: Branching and Price Decisions in a Two-Stage Model of Competition

In this paper we develop an empirical two-stage model of competition for the banking industry that incorporates the choice of capacity in the form of new branches. It is estimated using data on Italian banks for the years 1995-2009. The results show that the conduct of banks is significantly more competitive than a Bertrand-Nash equilibrium, and support the rejection of the simple one-stage specification, which underestimates the degree of competition. In the Fudenberg and Tirole (1984)’s taxonomy, banks are found to behave as ‘fat cats’, overinvesting in the branch network so as to keep prices high and accommodate entry.bank branch network; competition; market structure; conduct

Strategic Advertising for Entry Deterrence Purposes

This paper evaluates the possible effects of advertising on conditions of entry in a market with one incumbent and one potential entrant. Through a game-theoretic framework, it is shown that the use of pre-entry advertising expenditures (which are supposed to exhibit diminishing returns) may discourage entry even when firms behave rationally and face the same conditions of cost and demand.market structure; advertising

Competition Among Dominant Firms in Concentrated Markets: Evidence from the Italian Banking Industry

Conventional models of the industrial organisation theory usually state that in concentrated industries firms have significant market power, and that competition can be easily reduced if the leading firms collude. However, recent theoretical analyses show that strong concentration does not necessarily prevent competition among firms. In this paper we consider the Italian banking industry, where the eight largest firms operate at a national level, manage about a half of total loans, and have a notably larger dimension than the other competitors. We estimate a structural model – formed by a demand equation, a cost equation and a price cost margin equation, the latter containing a behavioural parameter – to assess the market conduct of the largest banks for the period 1988-2000. Our finding is that, in spite of their noteworthy size and significant market share, in these years the largest banks have been characterised by a more competitive conduct than the Cournot outcome: this is in line with the results of the latest literature of the field, for which in the banking industry there is often no conflict between competition and concentration.

Bank capital and profitability:Evidence from a global sample

This study employs bank-level data for a global sample to examine the relationship between capital and profitability over 2000-2013. Our evidence suggests that bank capital is positively related to bank profitability, although the estimated impact is relatively marginal. However, more capitalised banks that are more profitable appear to have a higher traditional risk, a greater proportion of non-traditional activities in their balance sheets and they tend to be more effective at controlling their costs. The relationship depends on environmental conditions as well and bank size. It is typically stronger in crisis periods, in lower and middle income countries and for larger banks (but not for Global Systemically Important Banks, or GSIBs). Finally, for banks operating in less restricted, more unstable and corrupt environments, the same increase in capital is associated with more profitable institutions than banks operating in countries with lower corruption levels. Our findings are robust to different specifications and robustness tests, and carry important implications for policy reforms aimed at ensuring stability to the banking sector globally

Growth without finance, finance without growth

The international comparative evidence on the nexus between finance and growth is ambiguous, owing to the many difficulties in isolating finance, separating its growth effect from that of the other factors. To overcome this problem, we study the effects of financial development on growth from 1960 to 2010 in one country – Italy. Thus we have the same political, legal and regulatory framework but also sharply differing development conditions between regions. After World War II Italy achieved an “economic miracle” similar to what China and India are now experiencing, followed by a lengthy phase of decline. Accordingly, we can distinguish the effect of financial development on growth from other potential causal factors while also considering regions with sharply different economic conditions. Our results show that from 1960 to 1980, when the Italian “economic miracle” was still under way, finance played no significant role in favouring the surge in economic growth, which most likely depended on internal consumption. Between 1980 and 2010, by contrast, the great expansion of Italian financial markets and institutions did have a positive effect on regional economic performance, but overall growth rates were nevertheless low. Although our empirical evidence supports the view that finance is more important for growth in less highly developed regions, it also shows that financial development has not helped to overcome the Italian economic divide

OTIMIZAÇÃO DAS CONDIÇÕES DE CULTURA PARA O CRESCIMENTO BACTERIANO COMO PARA PRODUÇÃO DA DEXTRANA-SACARASE A PARTIR DE Leuconostoc Pseudomesenteroides

Exopolissacarídeos de origem bacteriana têm despertado o interesse das mais variadas indústrias podendo ser utilizados para várias especialidades. A Dextrana é um dos exopolissacarídeos produzida por bactérias dos gêneros Leuconostoc, Lactobacillus e Streptococcus, pela ação da enzima Dextrana-Sacarase, que é ativada pela Sacarose (com exceção das espécies do gênero Streptococcus). A enzima utiliza a sacarose como substrato e polimeriza a dextrana. A Dextrana é um dos exopolissacarídeos de maior importância industrial, largamente utilizada como aditivo, espessante, estabilizante e emulsificante em produtos alimentícios, cosméticos, imobilizante em processos cromatográficos, e também na área médica, agindo como anticoagulante e extensor de plasma, dentre outros (Bhavani&Nisha, 2010).Muito empenho tem sido aplicado ao longo dos anos para desenvolver metodologias eficazes, rápidas e com menor custo para a produção das dextranas (Nigam et al., 2006); (Vettori et al., 2012). Assim, os estudos que se voltam para a Dextrana-Sacarase têm um papel fundamental neste processo. Dentre os benefícios desta abordagem, pode-se frisar a redução com gastos para manter a colônia, facilidade na separação final do produto com alto grau de pureza, além da possibilidade de reaproveitamento da enzima nas etapas da produção (Chiellini et al., 2001).Dessa maneira, o presente estudo se justifica, portanto, em elaborar um método eficaz na produção Dextrana-Sacarase através das bactérias láticas produtoras de exopolissacarídeos isoladas da região, afim de verificar qual o melhor meio a ser utilizado e as condições mais favoráveis para que estas cresçam mais rapidamente consequentemente obtendo eficiência na obtenção do exopolissacarídeo de grande interesse industrial

PURIFICAÇÃO DA ENZIMA DEXTRANA-SACARASE A PARTIR DE Leuconostoc pseudomesenteroides

A Dextrana é um dos exopolissacarídeos de maior importância industrial, largamente utilizada como aditivo, espessante, estabilizante e emulsificante em produtos alimentícios, cosméticos, imobilizante em processos cromatográficos, e também na área médica, agindo como anticoagulante e extensor de plasma, dentre outros (Bhavani&Nisha, 2010).Muito empenho tem sido aplicado ao longo dos anos para desenvolver metodologias eficazes, rápidas e com menor custo para a produção das dextranas (Nigam et al., 2006); (Vettori et al., 2012). Assim, os estudos que se voltam para a dextrana-sacarase têm um papel fundamental neste processo, principalmente, os que focam na purificação da enzima, cujo emprego na produção do polissacarídeo livre de células é um promissor campo quase inexplorado da indústria (Fattah et al., 2012). Dentre os benefícios desta abordagem, pode-se frisar a redução com gastos para manter a colônia, facilidade na separação final do produto com alto grau de pureza, além da possibilidade de reaproveitamento da enzima nas etapas da produção (Chiellini et al., 2001). O objetivo deste trabalho foi isolar e purificar a enzima dextrana-sacarase a partir da linhagem nativa R2 de Leuconostoc pseudomesenteroides

Systems engineering approach for pre-conceptual design of DEMO divertor cassette

Abstract This paper presents the pre-conceptual design activities conducted for the European DEMO divertor, focusing on cassette design and Plasma Facing Components (PFC) integration. Following the systems engineering principles, a systematic design method, the Iterative and Participative Axiomatic Design Process (IPADeP), has been adopted. Basing on Axiomatic Design, IPADeP supports the early conceptual design of complex systems. The work moved from the geometrical and interface constraints imposed by the 2015 DEMO configuration model. Then, since different materials will be used for cassette and PFCs, the divertor geometry has been developed taking into account the cooling parameters of the cassette Eurofer steel and the integration of PFCs cooling system. Accordingly, the design process led to a double wall cassette structure with internal reinforcing ribs to withstand cassette coolant pressure and three different kinds of piping schemes for PFCs with dual circuits. These three solutions differs in the feeding pipes layouts and target manifold protection and they have been proposed and evaluated considering heat flux issues, shielding problems, interface requirements with blanket and vacuum vessel and remote maintenance needs. A cassette parametric shell model has been used to perform first structural analyses of the cassette body against coolant pressure. Taking advantages of the parametric surface modelling and its linkage with Finite Element (FE) code, the cassette ribs layout and thickness has been evaluated and optimized, considering at the same time the structural strength needed to withstand the coolant parameters and the maximum stiffness required for cassette preloading and locking needs

EU-DEMO divertor: Cassette design and PFCs integration at pre-conceptual stage

The pre-conceptual design of the DEMO divertor cassette with a novelty, alternative path of the main cooling pipes inside cassette body is presented in this paper, focusing on cassette design and Plasma Facing Components (PFC) integration. The divertor cassette design is reviewed, considering recent updates in the DEMO configuration model as presented by the Programme Management Unit (PMU) in 2018. The new configuration requires the cooling pipes to be integrated inside the cassette body. The components affected by these changes and the impact on the divertor design are analyzed. The study focuses on a new integration system between cassette and cooling pipes. The paper describes the integration on the new cassette geometry and the divertor sub-systems. The design activities related to this system are discussed in detail in terms of CAD modeling and considerations with respect to manufacturing such as welding technologies and non-destructive testing