ABSTRACT
The laws of the Uni ted States have been hostile to market monopoly since the passage of the Sherman and Clayton Antitrust Acts in 1890 and 1914, respec· tively. This hostility has arisen because monopoly firms can often restrict volurne and set exploitative prices that their hapless customers must pay. Given this legacy, the last fifteen years have seen a remarkable turn of events in the U.S. banking industry. F or the last fifteen years, this industry has experienced an unrelenting merger wave and an unprecedented increase in concentration. This study reviews the economic evidence explaining why bank mergers are happening in such great numbers, and explores the effect of increased bank concentration and out-of-state ownership on banks' customers.
