Do Larger Brokearage Firms Enjoy Larger Economies of Scale and Scope?

Abstract

This study examined whether firm size determines the economiesof scale and scope of securities firms. Results showed that the firmsbroadly achieved economies of scale and substantially benefitted fromthe economies of scope in the Korean brokerage sector. In particular,greater economies of scale were present in large firms. Overall, agreat possibility and necessity of industrial restructuring throughM&A among brokerage firms exist in the Korean brokerage sector.