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The relative influence of price and non-price factors on short-term retail deposit quantities?

Ashton, J.K. and Gregoriou, A. and Healy, J.V. (2015) The relative influence of price and non-price factors on short-term retail deposit quantities? The European Journal of Finance. DOI: 10.1080/1351847X.2015.1019643

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Abstract

This study explores how price and non-price factors influence change in the quantity of short-term retail deposits held by depository institutions. The analysis is undertaken for a sample of UK building societies over 23 years using a disaggregated data set with a two-stage econometric procedure involving system estimators in a panel framework using seemingly unrelated regression, generalised method of moments and an ordinary least-squares fixed effects estimators to control for contemporaneous correlation and endogeneity concerns. Price factors examined include the policy or base rate and retail deposit interest rates set by individual building societies and non-price factors including the branch network and the number of deposit accounts offered by individual building societies. The cost of funds, one non-price factor and occurrence of mergers are consistently significant influences of retail deposit quantities. We conclude risk assessment of retail deposit quantity and monetary policy transmission would benefit from considering both price and non-price factors, rather than only price factors.

Item Type: Article
Subjects: Research Publications
Departments: College of Business, Law, Education and Social Sciences > Bangor Business School
Date Deposited: 10 Oct 2015 02:36
Last Modified: 10 Oct 2015 02:36
ISSN: 1351-847X
URI: http://e.bangor.ac.uk/id/eprint/5587
Identification Number: DOI: 10.1080/1351847X.2015.1019643
Publisher: Taylor & Francis
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