This paper presents a test for perfect competition in the deposit market of the UK retailbankingudsector. The model employed draws from the NEIO technique forwarded by Hannanudand Liang (1993). The test is applied to a sample of 8 UK retail banks between 1992-97. Theudpresence of perfect competition is rejected for all banks. The empirical evidence does notudsupport the qualitative evidence of increasing competitiveness amongst UK retail banks.
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