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July/August 2003, 
Vol. 85, No. 4
Posted 2003-07-01

The Real Effects of U.S. Banking Deregulation

by Philip E. Strahan

This article focuses on how one dimension of broad-based bank deregulation—the removal of limits on bank entry and expansion—affected economic performance. In a nutshell, the results suggest that this regulatory change was followed by better performance of the real economy. State economies grew faster and had higher rates of new business formation after this deregulation.