Considering the importance of the competition-stability trade-off, contradictory theoretical predictions, and empirical evidence, its re-investigation from the angle of non-linearity is needed. Therefore, this paper focuses on the association between bank stability and competition in Europe by employing a Boone indicator and alternative competition measures. Bank stability is measured with the z-score and loan loss reserves ratio. System-GMM estimations are carried out on a panel of banks from 27 European Union member countries over the period of 2004–2014. The results confirm that when a linear association between bank stability and competition is assumed, competition-stability argument prevails. However, when potential non-linearity of this association is assumed, the results appear more diverse and complex across different competition proxies. We observe signs of U-shape association between bank stability and competition for the Boone indicator and weaker signs of an inverse U-shape association with Lerner index. This indicates that before taking policy measures, it is important to consider the potentially non-linear association between bank stability and competition and to define which aspect of competition regulators want to address. The results concerning mature and emerging Europe exhibit also some differences, indicating that suitable regulatory approaches applied even within the EU could be rather different.

中文翻译：

---

欧洲银行市场竞争-金融稳定还是脆弱性增强？

考虑到竞争稳定权衡的重要性，矛盾的理论预测和经验证据，需要从非线性的角度对其进行重新研究。因此，本文通过采用Boone指标和替代性竞争措施，着重研究欧洲银行稳定性与竞争之间的关联。银行稳定性以z分数和贷款损失准备金比率衡量。2004-2014年期间，来自27个欧盟成员国的银行小组对系统GMM进行了估算。结果证实，当假设银行稳定性与竞争之间存在线性关联时，竞争稳定性论据占优势。但是，如果假设此关联具有潜在的非线性，则结果在不同的竞争代理之间显得更加多样化和复杂。我们观察到银行稳定性和Boone指标竞争之间存在U型联系的迹象，以及与Lerner指数呈反向U型联系的迹象较弱。这表明在采取政策措施之前，重要的是要考虑银行稳定性和竞争之间可能存在的非线性关联，并确定竞争监管机构要解决的方面。关于成熟和新兴欧洲的结果也显示出一些差异，这表明即使在欧盟内部也适用的适当监管方法可能会大不相同。重要的是要考虑银行稳定性和竞争之间可能存在的非线性关联，并确定竞争监管机构要解决的方面。关于成熟和新兴欧洲的结果也显示出一些差异，这表明即使在欧盟内部也适用的适当监管方法可能会大不相同。重要的是要考虑银行稳定性和竞争之间可能存在的非线性关联，并确定竞争监管机构要解决的方面。关于成熟和新兴欧洲的结果也显示出一些差异，这表明即使在欧盟内部也适用的适当监管方法可能会大不相同。