Multilevel empirics for small banks in local markets

Aiello, Francesco; Bonanno, Graziella

doi:10.1111/pirs.12285

Cited by 15 publications

(4 citation statements)

References 108 publications

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“…We also believe hierarchical methods deserve more attention in the economics and marketing literature, where there are many opportunities to measure how variables on one level affect the outcome on another level. Some laudable exceptions, however, include Aiello and Bonanno ( 2018 ) assessing the profitability of banks nested within local markets and Keller et al ( 2019 ) assessing the effect of a promotion event on sales of brands nested within retailers.…”

Section: Discussionmentioning

confidence: 99%

Twitter-patter: how social media drives foot traffic to retail stores

et al. 2023

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This paper answers how changes in social media activity influence customers to visit nationally known, brick-and-mortar retail stores. We consider seven measures of social media activity within a Social Impact Theory framework and test under what context does online chatter about a brand lead to higher foot traffic to those brand stores. We use hierarchical linear regression to account for the random effects of brand and store heterogeneity, which is superior to ordinary linear regression. Despite wide variation, when brand mentions increase by one standard deviation—either in likes or disagreement—then next-day foot traffic to stores of that brand will increase by 0.04 standard deviations (3–4%). This modest but meaningful effect, however, fully dissipates within 1 week. The weak cross-brand effects show that social media has distinct and larger influence on brands individually rather than universally. Our approach is novel due to (1) the large scale of data, (2) the breadth of analysis, (3) the multi-level specification, and (4) in estimating global elasticities between changes in electronic word-of-mouth (WoM) communication about brands and changes in store visits of those brands.

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Section: Discussionmentioning

confidence: 99%

Twitter-patter: how social media drives foot traffic to retail stores

et al. 2023

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“…Interestingly, the study of Tabak et al (2013) shows the shortcomings of nonspatial efficiency studies, particularly when applied to a financial intermediary operating exclusively in a local market. Aiello and Bonanno (2018a) follow an empirical strategy focused on multilevel models rather than spatial approaches to investigate the influence of bank clusters on the efficiency of small banks. Their results show that provincial‐level characteristics, as well as market concentration, have an impact on the efficiency of Italian banks.…”

Section: Literature Reviewmentioning

confidence: 99%

Spatial dependence in the technical efficiency of local banks

Algeri

Anselin

Forgione

et al. 2022

Papers in Regional Science

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Cooperative banks primarily compete with one another because they target niche markets that large banks typically ignore. The current study shows that in this competitive environment, the connection between financial intermediaries affects the operational efficiency of small banks. The findings indicate that the capitalization, diversification strategies, funding costs, liquidity, credit quality, and risk of bank neighbors have spillover effects on technical efficiency. Thus, bank networks trigger a cascading effect that demands the attention of bank stakeholders.

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“…Furthermore, SMEs nested in local markets (NUTS 2) represent level 3 of the structure. This hierarchy is widely used in the multilevel model literature on panel data (Aiello & Bonanno, 2018; Steele, 2008). The basic model is:

y_{tij} = β_{0 italicij} + e_{tij},

where y tij is a vector of the firm soundness measure of the i th corporation operating in the j th region (with t = 2010...,2015, i = 1..., Nj and j = 1, …, p ) at time t. The error term e tij captures randomness due to time.…”

Section: Empirical Strategymentioning

confidence: 99%

Firm financial soundness and knowledge externalities: A comparative regional analysis

Fattah

Arcuri

Garsaa

et al. 2020

Papers in Regional Science

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This paper investigates the role of the regional context with regard to the influence of human capital and knowledge spillovers on SMEs' financial soundness. Our empirical setting is based on a multilevel analysis of panel data, which allows superior treatment of hierarchical data. The analysis is applied to SMEs belonging to the manufacturing sector and operating in four European countries over the period 2010–2015. We find that a combination of individual and regional‐level characteristics explains firm soundness better than individual features alone. Furthermore, we find that a high local educational level and knowledge spillovers improve firm soundness and that their effects vary according to the regional level of knowledge. These results are confirmed by several robustness tests.

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Multilevel empirics for small banks in local markets

Cited by 15 publications

References 108 publications

Twitter-patter: how social media drives foot traffic to retail stores

Twitter-patter: how social media drives foot traffic to retail stores

Spatial dependence in the technical efficiency of local banks

Firm financial soundness and knowledge externalities: A comparative regional analysis

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