The relationship between banking market competition and risk-taking: Do size and capitalization matter?

This paper addresses the effects of bank competition on the risk-taking behaviors of banks in 10 Latin American countries between 2003 and 2008. We conduct our empirical approach in two steps. First, we estimate the Boone indicator, which is a measure of competition. We then regress this measure and other explanatory variables on the banking "stability inefficiency" derived simultaneously from the estimation of a stability stochastic frontier. Unlike previous findings, this paper concludes that competition affects risk-taking behavior in a non-linear way as both high and low competition levels enhance financial stability, while we find the opposite effect for average competition. In addition, bank size and capitalization are essential factors in explaining this relationship. On the one hand, the larger a bank is, the more it benefits from competition. On the other hand, a greater capital ratio is advantageous for banks that operate in collusive markets, while capitalization only enhances the stability of larger banks under high and average competition. These results are of extreme importance when considering bank regulations, especially in light of the recent turmoil in the global financial markets. (C) 2012 Elsevier B.V. All rights reserved.

Enhancement of behavioral sensitization, anxiety-like behavior, and hippocampal and frontal cortical CREB levels following cocaine abstinence in mice exposed to cocaine during adolescence

Adolescence has been linked to greater risk-taking and novelty-seeking behavior and a higher prevalence of drug abuse and risk of relapse. Decreases in cyclic adenosine monophosphate response element binding protein (CREB) and phosphorylated CREB (pCREB) have been reported after repeated cocaine administration in animal models. We compared the behavioral effects of cocaine and abstinence in adolescent and adult mice and investigated possible age-related differences in CREB and pCREB levels. Adolescent and adult male Swiss mice received one daily injection of saline or cocaine (10 mg/kg, i.p.) for 8 days. On day 9, the mice received a saline injection to evaluate possible environmental conditioning. After 9 days of withdrawal, the mice were tested in the elevated plus maze to evaluate anxiety-like behavior. Twelve days after the last saline/cocaine injection, the mice received a challenge injection of either cocaine or saline, and locomotor activity was assessed. One hour after the last injection, the brains were extracted, and CREB and pCREB levels were evaluated using Western blot in the prefrontal cortex (PFC) and hippocampus. The cocaine-pretreated mice during adolescence exhibited a greater magnitude of the expression of behavioral sensitization and greater cocaine withdrawal-induced anxiety-like behavior compared with the control group. Significant increases in CREB levels in the PFC and hippocampus and pCREB in the hippocampus were observed in cocaine-abstinent animals compared with the animals treated with cocaine in adulthood. Interestingly, significant negative correlations were observed between cocaine sensitization and CREB levels in both regions. These results suggest that the behavioral and neurochemical consequences of psychoactive substances in a still-developing nervous system can be more severe than in an already mature nervous system