Ernest Lecomte*, Mariya Sakharova**

*We investigate the supply and demand drivers of bank deposit pricing in the Euro area during the period 2007–2024. We document that the pass-through of policy rates to sight deposit rates is low, asymmetric, varies across the monetary policy regimes, and decreases over time. We build and estimate an equilibrium model of bank deposit markets, and find that the price sensitivity of depositors exhibits large heterogeneity between households and firms, across countries, and over time. Our estimates suggest that rate-sensitive depositors increasingly switched to alternative, higher-yielding savings products over time, thereby decreasing the average rate-sensitivity of the remaining pool of sight deposits. In turn, banks’ market power over sight deposits increased, thereby accounting for the sluggish increase in overnight deposit rates following the 2022 European Central Bank’s policy rate hikes.

**Different social classes have different tools at their disposal, such as political influence and collusion, which in turn influence the market structure of an economy. While the effects of political influence have been studied, the prevalence and associated outcomes of collusion are unclear, since collusion is usually illegal and thus difficult to measure. I collect a novel dataset on collusion in Late Tsarist Russia and use classic and staggered differences-in-differences to study the relationship between elites, foreign entities, merchants and collusion, and how collusion may affect industrialization. Industries with elite presence are not necessarily more collusive. However when there is a contraction in demand these industries see an increase in collusion, especially when they face foreign competition. Colluding firms within the metals sector see their machine power increase, indicating collusion gave them more financial leeway to mechanize in an environment with underdeveloped financial markets - implying that in such a setting collusion was beneficial for industrialization.