Non-mean-field effects in systems with long-range forces in competition

We investigate the canonical equilibrium of systems with long-range forces in competition. These forces create a modulation in the interaction potential and modulated phases appear at the system scale. The structure of these phases differentiate this system from monotonic potentials, where only the mean-field and disordered phases exist. With increasing temperature, the system switches from one ordered phase to another through a first-order phase transition. Both mean-field and modulated phases may be stable, even at zero temperature, and the long-range nature of the interaction will lead to metastability characterized by extremely long time scales.

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.