Role of financial innovations in oligopolistic market environment

Abstract

Price stability usually prevails in the long run in oligopolistic markets, and the role of price race is replaced by research & development and innovation, advertising, and brand names. The current banking market of Hungary is strongly oligopolistic, with limited price competition in the scope of financial products and services. Various financial innovations, brands, and name brand values – as well as intensive communication thereof by advertisements and other PR tools – are of increasing significance in banks' successful market strategies.