Big Bad Banks? The Impact of U.S. Branch Deregulation on Income Distribution

Thorsten Beck, Ross Levine () and Alexey Levkov

No 13299, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: By studying intrastate branch banking reform in the United States, this paper provides evidence that financial markets substantively influence the distribution of income. From the 1970s through the 1990s, most states removed restrictions on intrastate branching, which intensified bank competition and improved efficiency. Exploiting the cross-state, cross-time variation in the timing of bank deregulation, we evaluate the impact of liberalizing intrastate branching restrictions on the distribution of income. We find that branch deregulation significantly reduced income inequality by boosting the incomes of lower income workers. The reduction in income inequality is fully accounted for by a reduction in earnings inequality among salaried workers.

JEL-codes: D31 G28 O16 (search for similar items in EconPapers)
Date: 2007-08
New Economics Papers: this item is included in nep-ban and nep-reg
Note: CF DAE EFG
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

Published as BECK, T., LEVINE, R. and LEVKOV, A. (2010), Big Bad Banks? The Winners and Losers from Bank Deregulation in the United States. The Journal of Finance, 65: 1637–1667. doi: 10.1111/j.1540-6261.2010.01589.x

Downloads: (external link)
http://www.nber.org/papers/w13299.pdf (application/pdf)

Related works:
Working Paper: Big bad banks? The impact of U.S. branch deregulation on income distribution (2007)
Working Paper: Big bad banks ? the impact of U.S. branch deregulation on income distribution (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:13299

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w13299

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().