On the Interaction Between Vertical and Horizontal Product Differentiation: An Application to Banking
Year: 1996
Type: article
Abstract: The author studies the conditions under which banks offer remote access. Note there exists interaction between location and taste for remote access. Offering remote access is an instrument to (partially) segment depositors according to their taste for that technology. The interaction between location and taste for remote access enhances this effect. Different equilibria emerge as the result of two effects. First, introducing remote access steals depositors from the opponent as the product specification becomes more appealing. Second, deposit rate competition is affected as remote access determines the substitutability of banks. Copyright 1996 by Blackwell Publishing Ltd.
Source: Journal of Industrial Economics
DOI: 10.2307/2950644
Author: Hans Degryse
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1833298673