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Switching costs and bank competition: evidence from dual banking economies

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dc.contributor.authorSiti K. Rizkiah
dc.contributor.authorMustafa Disli
dc.contributor.authorAhmad Lutfi Abdul Razak
dc.contributor.authorKinan Salim
dc.date.accessioned2021-11-30T01:28:22Z
dc.date.available2021-11-30T01:28:22Z
dc.date.issued2021
dc.description.abstractThere is a strong theoretical foundation that demonstrates costs of switching as one of the main barriers in creating a healthy level of competition. Switching costs might even be more prevalent for Islamic banks due to Shariah dimension since Shariah driven customers are limited to only switch to banks that offer Shariah-compliant products. However, the banking market is not completely segmented as Islamic banking clients can switch to conventional banks, and vice versa. This paper examines the degree of switching costs in Islamic and conventional banks, and investigates its influence on bank competition in dual banking economies. We find that conventional banks inherit higher switching costs than Islamic banks. The finding is consistent for all countries in the sample except for Malaysia and Bahrain. We also find that switching costs during the global financial crisis are higher than the rest of the years. We further document a significant negative relationship between switching costs and bank competition, while this relationship is more pronounced for Islamic banks.en_US
dc.identifier.citationRizkiah, S. K., Disli, M., Salim, K., & Abdul Razak, A. L. (2021). Switching costs and bank competition: evidence from dual banking economies. Journal of International Financial Markets, Institutions & Money, 75, Article 101445. https://doi.org/10.1016/j.intfin.2021.101445en_US
dc.identifier.doihttps://doi.org/10.1016/j.intfin.2021.101445
dc.identifier.issn1042-4431
dc.identifier.urihttps://ikr.inceif.edu.my/handle/INCEIF/3481
dc.languageEnglish
dc.language.isoengen_US
dc.publisherElsevier B.V.en_US
dc.rights2021. Elsevier B.V.
dc.sourceSEDONA
dc.subjectSwitching costsen_US
dc.subjectMarket poweren_US
dc.subjectIslamic bankingen_US
dc.subjectDual banking systemen_US
dc.titleSwitching costs and bank competition: evidence from dual banking economiesen_US
dc.typeJournal Articleen_US
dlc.maintopicIslamic bankingen_US
dspace.entity.typePublication
ikr.doctypeScholarly Works
ikr.topic.maintopicIslamic bankingen_US
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relation.isAuthorOfPublication.latestForDiscovery10a8c75a-02bf-4122-a23c-40d4ef3b59b3
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