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Volume 66, Issue 3


Which Came First, the Chicken or the Egg? Banks and Firms on Local Banking Markets

Jackowicz, Krzysztof; Kozlowski, Lukasz

Year: 2016   Volume: 66   Issue: 3   Pages: 182-206

Abstract: This study investigates the interactions between the financial health of cooperative banks and the performance of small and medium-sized enterprises (SMEs). Using a unique dataset on local banking markets in Poland, we establish that a strong financial standing of SMEs improves the profitability of banks that operate in the same neighborhood; however, the growth of banks is not affected. In contrast, the financial situation of cooperative banks is generally irrelevant for SME performance.

JEL classification: G21, G28

Keywords: local banks, cooperative banks, small and medium-sized enterprises, post-transition countries


RePEc: http://ideas.repec.org/a/fau/fauart/v66y2016i3p182-206.html

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