Australia's financial markets oligopolistic? (1 Viewer)

[planino]

Would you guys describe the competitive situation within Australia's financial markets as oligopolistic because of the big 4 banks? Which areas of the financial markets are more competive than others?

 

[chrisman9519]

yes i would. i did an essay about that very topic, u want it?

 

[planino]

oh yes please!
PMed

 

[chrisman9519]

also remember that competition in retail banking is not always a good thing. to produce banking competition you need to issue banking licenses. competition may result in innovation, however it leads to risk taking and leveraging in finance, something that tends to result in crises. back when a banking license was difficult and costly to obtain, a banker would be loathed to risk losing that license by taking unnecessary risks. by promoting too much competition in the banking industry, it makes it hard to achieve sizeable economies of scale which would allow cheaper wholesale borrowing.

just saying

 

[planino]

lol I didn't even know what a banking license was, thanks for that info

 

[planino]

nice essay, it made me understand the whole concept of competition within fins markets seem a lot easier actually