ABSTRACT
The model developed in the preceding chapter is used in this chapter to analyze bank behavior in California over the period 1878-1908. The first part of the chapter is devoted to the estimation of the equation presented in the last section of the previous chapter, with data that are available for California’s banks and its economy in these years. The first section discusses the nature of the data and the definition of local banking markets, and explains the definitions of the variables used in the estimation of the model. The second section of the chapter reports the results obtained when a linear version of the model is estimated with multiple regression analysis. These results are then compared with those reported by other researchers. In the final section, some conclusions are drawn about bank behavior in California during this period, and some answers are given to the questions posed at the end of Chapter 4.
