Purpose – This study measures how competitive securities broker-dealers are in the Korean financial markets. It aims to test whether the markets are perfectly competitive or monopolistic since the global financial crisis of 2008.
Research design, data, and methodology – We apply the method developed by Panzar and Rosse (1987), H-statistics, which offers an index for the competitiveness as well as statistical tests. The dataset in use is retrieved mainly from the quarterly statements of the financial services companies by the Financial Statistics Information System of the Financial Supervisory Service. General information on officers and employees is utilized in addition to balance sheets and income statements of securities companies.
Results – H-statistics for 2009-2015 is about 0.7 that is a robust estimate regardless of model specifications such as full trans-log, partial trans-log, and Cobb-Douglas regression equations. H-statistics for each year is also computed in similar ways in that it varies between 0.3 and 0.9.
Conclusions – Since the global financial crisis, H-statistics concludes that securities broker-dealer markets in Korea is neither perfectly competitive nor monopolistic. It evidences that the markets are rather monopolistically competitive. The trend in annual H-statistics leads to the same conclusion but the result is not such stable that overall H-statistics implies.

Abstract
 1. Introduction
 2. Literature Review
  2.1. Traditional Measures and Their Limits
  2.2. H-statistics by Panzar and Rosse (1987)
  2.3. Some Applications to Financial Markets
 3. Model and Analysis
  3.1. Dataset
  3.2. Regression Specifications and Variables
 4. Results
 5. Conclusions and Discussions
  5.1. Concluding Remarks
  5.2. Limitations and Further Research
 References

• Jae-Hyun Gwon(School of Northeast Asian Studies, Incheon National University)