Italian banks' market power impacts financial stability in surprising ways.
The article explores how the market power of banks in Italy from 2001 to 2012 affects their financial stability. The researchers found that there is a U-shaped relationship between market power and financial stability. They also discovered that bank size plays a crucial role in this relationship, with cooperative banks having different incentives compared to commercial banks. The study used data from different types of banks in Italy and focused on specific geographical areas to analyze the market power-stability link.