Market structure of the banking sector and its relation to economic growth: A review of literature

Abstract

This document reviews the literature of studies that were carried out on the market structure of the banking sector and its relationship with economic growth for the scope of more research on the subject in question. The importance of this study is to show the market behavior of the banking sector, that is, if it is a monopoly, monopolistic competition or perfect competition, in order to determine the impact, it would have on economic growth. The bibliography search is carried out mainly in the journals found on the Scopus platform and those journals that are in quartile 1 (Q1) are taken into account, taking a total of 53 articles. The analysis of the literature shows that the banking sector has a behavior of monopolistic competition but that it is close to a market of perfect competition, and the relationship that exists between credits and economic growth is positive; in addition, the financial system must be competitive and efficient as a prerequisite for having an impact on economic growth.