Switching Costs in the Deposit Market
Bibliographic Data
| ID | 9711629 |
|---|---|
| Authors | M G Zephirin, Mary Zephirin (Barbados Community College, corresponding author) |
| Year | 1994 |
| Volume | 104 |
| Issue | 423 |
| Pages | 455 |
| Publication date | 1994-03-01 |
| Open Access | No |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.2307/2234764 |
| OpenAlex | W2091766257 |
| Language | EN |
| Citations received | 1 |
| References cited | 2 |
This paper derives switching costs endogenously as a tradeoff between service quality and the interest rate faced by a depositor who values the services provided by banks. In a market with known interest rates and uncertain service, the depositor must locate satisfactory bank service. The depositor who establishes a good reputation with the satisfactory bank enjoys improved relationship-specific service. The improvement produces utility gains from remaining with the bank. These gains result in tradeoff. In the long-run of this market, when banks are forward looking, such switching costs facilitate monopsonistic determination of deposit rates
Business · Economics · Interest rate · Microeconomics · Monetary economics · Quality (philosophy · Reputation · Service (business · Banking stability, regulation, efficiency · Digital Platforms and Economics · Economic theories and models · Marketing
| Citations per year | 0.05 |
|---|---|
| Citation span | 2004 - 2004 (1) |
| Highly cited | No |