Testing the Law of One Price in Retail Banking: An Analysis for Colombia Using a Pair-wise Approach

Publicado en

  • Economics Letters


  • We apply a pair-wise approach to test the law of one price for deposit (lending) rates in Colombia. We find that when banks are of different sizes, deposit rates adjust quickly, suggesting a competitive environment. By contrast, lending rates adjust rapidly when banks are of similar sizes, supporting market segmentation.

fecha de publicación

  • 2013

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