Measurement of competitiveness degree in Vietnamese commercial banks - An application of the panzar and rosse model

Abstract

This paper investigates the behavior of competitiveness of Vietnamese banking system during the period of 2008-2012. Using the bank-level data for the Vietnamese banking market, the monopoly power of banks is evaluated by using the “Hstatistic” provided by Panzar and Rosse. The result shows that banks in Vietnam are under the condition of monopolistic competition. In addition, the findings suggest that the state owned banks are basically less competitive than the private banks.