Determinants of Interest Margins in Colombia

Borradores de Economia
Number: 
393
Published: 
Classification JEL: 
L11, L41, L89, G21
Keywords: 
Human capital agglomeration, Social returns, Private returns, Externalities, Uncertainty, Fiscal policy

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This paper analyzes the determinants of interest margins in the Colombian Financial System. Based on the model by Ho and Saunders (1981), interest margins are modelled as a function of the pure spread and bank-specific institutional imperfections using qu