Has Competition in the Japanese Banking Sector Improved?

Figure 5. Estimates of θ_t for regional banks, with r^d in eq. (8) being the cost of capital

— ^!—estimates

—■—95% upper

—Л—95% lower
→-1/n

Note: MVR estimates of θ_t of regional banks are shown with their 95% confidence interval. While r^d in eq. (8) is the deposit interest rate in

Figures 2 and 3, the cost of capital is used for the data of r^d in the estimation of this Figure.

33

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