Who are my rivals? multimarket contact and competitive asymmetry in spanish banking

Abstract

Traditionally, both competitor identification and the analysis of interfirm rivalry have been approachedfrom an industry perspective. After that, researchers or analysts have calculated aggregate indexes(such as CR or Herfindahl) that synthesize its structure. However, the availability of detailed informationhas allowed researchers to design new proposals that capture the interdependences arising amongfirms more precisely. In this paper, we use one of such proposals in order to describe the competitivesituation in the Spanish banking sector. Specifically, we use one of the dimensions introduced by Chen(1996), market commonality, in order to identify the main rivals of every bank, savings bank or credit unions that operate in our country. Within this context, we pay special attention to the identification of themost important rivals for Banco Santander