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Title: Productivity Changes in Pre-Crisis Western European Banks: Does scale effect really matter?
Authors: 李起銓;黃台心
Contributors: 金融系
Keywords: Metafrontier Malmquist productivity index;Technical efficiency change;Scale effects;Catch-up
Date: 2016-01
Issue Date: 2016-07-13 11:32:47 (UTC+8)
Abstract: Insofar as the completion of the Single Market for Financial Services, it has presented new challenges for European Banking industries. In this study, we use a recently developed generalized metafrontier Malmquist productivity index (gMMPI) to provide insights on productivity growth. We extend the gMMPI to broaden the index's capacity by decomposing various sources of productivity change in the metafrontier context. The sample contains commercial banks from 12 Western European countries prior to the recent financial crisis. A key advantage of our extension is that it introduces the role of scale effects. The empirical results show that an average bank's productivity growth arises mainly from technical changes and scale effects. Moreover, smaller and larger banks grow faster than medium ones. In addition, conservative banks tend to grow faster. These findings suggest that a more competitive and integrated financial market induced by financial deregulation is indeed able to improve banks’ productivity.
Relation: North American Journal of Economics and Finance, 36, 29-48
Data Type: article
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Appears in Collections:[金融學系] 期刊論文

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