Discussion paper

DP14516 Two Centuries of U.S. Banking Concentration: 1820-2019

Concentration plays a key role in banking efficiency and stability, yet the literature lacks any long-run analysis of U.S. banking industry structure. This paper uses newly-collected archival data to provide the first study of banking concentration from the early years of the republic through 2019. While concentration was declining or stable before the mid-1920s, statistical tests identify a structural break thereafter, as concentration started steadily rising as a result of growth at the nation’s largest five banks, particularly those located in New York City. A second structural break in the mid-1990s further accelerated the upward trend in concentration before slowing down during the Great Recession.


Fohlin, C and M Jaremski (2020), ‘DP14516 Two Centuries of U.S. Banking Concentration: 1820-2019‘, CEPR Discussion Paper No. 14516. CEPR Press, Paris & London. https://cepr.org/publications/dp14516