Bankarization and the determinants of banking services availability in the Province of Córdoba: an application of spatial data models

Abstract

This work analyzes bankarization and the determinants of the availability of banking services in the province of Córdoba for the period 2000-2019. According to the results, branch settlement in towns with less than 10,000 inhabitants does not seem to be a profitable strategy for private banks and these cities must be served by public institutions. There is a shortage of bank branches in towns with more than 25,000 inhabitants and these cities reveals the greatest incentives to settle a private bank branch, despite the significant presence of public banks. The spatial regression models with a cross-sectional structure identify the number of inhabitants, the level of employment and the number of retirees/pensioners as determinants with a positive and significant association, while the dispersed rural population presents a negative association. The effects differ according to the type of bank (public or private) and to the service channel. The spatial dependence allows us to identify overflow effects in some variables.

Date of presentation: 06-19-2020

Date of approval: 01-11-2021

JEL classification: G20