부산대학교 도서관

The purpose of this study is to explore the affections of loan market from establishing Financial Holding Co., Ltd., for confirming the market structure of Taiwan's Banking Firms. This study used 41 banks over the period 1997-2004, and adopted cost function used by Schmidt and Sickles(1984) and Cornwell, et al(1990).Under the assumption of profit maximization, first, this study derives the first-order conditions for each banking firm by choosing two output quantities. Those optimal conditions together with the cost function and share equations form the system of five regression equations that will be applied to estimate the cost function and conjectural variations of Taiwan's Banking Firms. Analyzing the empirical results, we can understand the affections of establishing Financial Holding Co., Ltd., on market structure in Taiwanese Banking. The empirical results have shown that: The market structure of Taiwanese banking is imperfect competition. Establishing Financial Holding Co., Ltd. will lead Taiwanese banking firms into imperfect competition.