How Bank Performance Related to Market Structure? A Panel Data Approach

Performance of banking system in addition to other factors, has been reflected in indices such as profitability, competition and efficiency. In order to determine these exogenous factors, in this paper we use a simple Cournot model. Then, using an econometric model, we test the hypothesis related to market structure and profitability of banking system.Over the period of 1980-2007, the sample of our study is consisted of Iran and some oil and nonoil countries with some similarities and differences in structures. To estimate the dynamic panel data model, we use GMM system estimator. Our results show the existence of power market hypothesis in monetary market of these countries.