Foreign Banks Penetration Into Nordic Countries

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Critical reading of foreign banks penetration into Nordic countries


Foreign banks’ penetration in Nordic countries is a representative research paper presented by Engwall and his partners to illustrate the evolution of the market share of foreign banks over times. And my paper is organized to provide a short summary of this article, and then analyze the research from a methodological perspective. By discussing some of the methodological limitations inherent in Engwall’s research, readers may get some inspirations to try other ways to explore this research topic.

1. Introduction

More than 150 years has past since banks began to enter into foreign direct investment (FDI) and numerous theoretical attention has been drawn to explore the entry and survival of foreign banks in comparable industry across countries, especially US-focused (Adrian, 2000). However, in Nordic countries, there is a long history of closure to foreign banks. And it was until 1971, Denmark then first opened its markets to foreign banks. As a senior professor from Nordic countries, Lars Engwall cooperating with another three experts of banking and financial markets, want to make a contribution to complement the synchronic research with diachronic research by pointing out what are the constituents that affect the market share of foreign banks in Nordic countries.

Instead of focusing on successful or survived individual banks, the subjects of Engwall’s study are the foreign banks as a whole in each Nordic country sector. They want to come up with a model to illustrate the relationship between foreign banks’ market share and each possible determinant, and then analyze which is/are the key influencing factor(s).

2. Limitations inherent the research

To begin with, the authors referred to abundant of available literatures, which include Walter’s control of enterprises and global economy; Baum’s organizational ecology etc. And among these,...
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