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Abstract

We assess the impact of bank deregulation on the distribution of income in the United States. From the 1970s through the 1990s, most states removed restrictions on intrastate branching, which intensified bank competition and improved bank performance. Exploiting the cross-state, cross-time variation in the timing of branch deregulation, we find that deregulation materially tightened the distribution of income by boosting incomes in the lower part of the income distribution while having little impact on incomes above the median. Bank deregulation tightened the distribution of income by increasing the relative wage rates and working hours of unskilled workers.

Publication Type:	Article
Additional Information:	This is the peer reviewed version of the following article: Beck, T., Levine, R. & Levkov, A. (2010). Big Bad Banks? The Winners and Losers from Bank Deregulation in the United States. The Journal of Finance, 65(5), pp. 1637-1667., which has been published in final form at http://dx.doi.org/10.1111/j.1540-6261.2010.01589.x. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving."
Publisher Keywords:	Financial Institutions, Government Policy and Regulation; Income Inequality
Subjects:	H Social Sciences > HG Finance
Departments:	Bayes Business School > Finance
SWORD Depositor:	Symplectic Administrator

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