Title: Information technology and long term trends of financial services supply

Authors: Alexandre Rands Barros

Addresses: Federal University of Pernambuco, Brazil

Abstract: There are two observed trends in the structure of financial institutions. The first one is consolidation, which leads to inter-firm concentration and the second one is the regional dispersion of their output. Both phenomena are often seen as consequences of development in the technology of information. This paper studies this relationship, theoretically and empirically, and shows that the likely impact of such development actually leads to regional dispersion, as seen in the data, and also to the reduction of inter-firm concentration. The major determinant for this impact is the market power of firms. Although there is not sufficient data to generate any strong conclusion, empirical results support the theoretical hypothesis, forwarded by the model presented in the paper.

Keywords: information technology; financial services; inter-firm concentration; regional dispersion

DOI: 10.1504/GBER.2004.006234

Global Business and Economics Review, 2004 Vol.6 No.1, pp.149 - 170

Published online: 07 Feb 2005 *

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