Market Structure and Competition in Emerging Market: Evidence from Malaysian Islamic Banking Industry

Abdul Majid, Muhamed Zulkhibri and Sufian, Fadzlan (2007): Market Structure and Competition in Emerging Market: Evidence from Malaysian Islamic Banking Industry. Published in: Journal of Economic Cooperation , Vol. 2, No. 28 (2007): pp. 99-121.

Abstract

This paper investigates the market structure of Islamic banking industry in Malaysia during 2001-2005 and evaluates the degree of competition using the H-statistic by Panzar and Rosse (1987). The estimated H-statistics for the whole sample periods are positive ranging from 0.38 to 0.62 and the Wald test for the market structure of monopoly or perfect competition is rejected implying that the Islamic banks in Malaysia earned their revenue in the condition of monopolistic competition.

• Item Type: MPRA Paper
• Language: English
• Keywords: Competition; Panzar-Rosse model; Islamic Bank; Malaysia; Market structure
• Subjects: D - Microeconomics > D2 - Production and Organizations > D24 - Production ; Cost ; Capital ; Capital, Total Factor, and Multifactor Productivity ; Capacity; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance

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