Financial deregulation and productivity growth in banking sector: empirical evidence from Bangladesh

This article examines the effects of regulatory reform on productivity growth in the Bangladesh banking industry. We use a unique balanced panel dataset comprising bank-level annual data from the early deregulation year (1984) to the most recent available period (2012) from major commercial banks in Bangladesh. Applying the Färe-Primont index, the paper provides estimates of productivity growth and identifies sources of total factor productivity (TFP) change. Empirical results show the sample banks have experienced positive TFP change after the financial deregulation. On average, TFP growth is higher in private banks than their public sector counterparts in the post-reform period. In addition, the decomposition analysis shows technological progress is the main driver of productivity change. Similar results are obtained by using the stochastic frontier analysis (SFA). Thus, empirical results remain robust irrespective of the methodology used. The regression analysis finds a positive technical change in the first stage of the reform program, i.e. during the transition period, as leading banks employ advanced technology to compete with potential new entrants. The result also shows that the banking industry still remains concentrated within the state-owned banks.     

Financial Disruptions and Bank Productivity Growth: Evidence from the Malaysian Experience

This paper examines, for the first time, the productivity of the Malaysian banking sector around the Asian financial crisis 1997. The non-parametric Malmquist Productivity Index (MPI) is used to compute individual banks’ productivity levels. We find that the Malaysian banking sector has exhibited productivity regress due to the decline in efficiency. The results seem to suggest that the domestic banks have exhibited productivity progress attributed to technological change, while the foreign banks have exhibited productivity regress due to efficiency decline. We find that the large banks tend to experience productivity growth attributed to technological progress, while the small banks tend to experience productivity decline due to technological regress. The empirical results suggest that the small banks with its limited capabilities are at a disadvantage compared with their larger counterparts in terms of technological advancements, thus, rejecting the divisibility theory.     

Productivity and efficiency change and shareholder value: evidence from the Spanish banking sector

Productivity change and shareholder value have been analysed in the banking sector in the last few years, although it should be noted that these two important aspects have been studied separately. In this regard, the main contribution of our study is to link these two lines of research by verifying whether those banks characterized by higher levels of efficiency and productivity change have a higher shareholder value. To measure changes in efficiency and productivity we use the Malmquist nonparametric technique, which is calculated from Data Envelopment Analysis (DEA) linear programming approach. The Malmquist total factor productivity index enables separation of the ‘catching up’ effect, i.e. changes over time in technical efficiency, from ‘technological change’, i.e. the shift of best practice frontier over time due to technological progress. Our results for a sample of listed Spanish banks in the period 2000 to 2004 confirm that those banks with higher efficiency and productivity changes have a higher shareholder value, even after controlling for the impact of traditional measures of performance, such as return on assets.     

中国商业银行业的全要素 生产率增长及其分解——基于24家银行面板数据的实证分析

本文收集了2003-2010年24家商业银行的非平衡面板数据,首先通过构建随机前沿生产模型,对中国银行业的技术效率进行测算,然后利用TFP分解模型对商业银行TFP增长的驱动因素及其演变过程进行了系统分析。研究发现,整体来说,中国银行业的全要素生产率在所有年份均实现了明显的增长。相对而言,国有大型商业银行在研究初期并没有显示出明显的优势,但随着时间的推移,其TFP增长率开始不断上升,并逐渐赶超中小型银行。通过对TFP增长率的分解计算,技术效率变化和要素配置效率变化对中国银行业TFP增长具有较强的拉动作用,技术进步的影响并不明显,而规模效率变化的负面作用最为显著。     

Technological Progress versus Efficiency Gain in Manufacturing Sectors

This study decomposes the nonparametric Malmquist productivity index for 36 Korean manufacturing sectors into two components: technological change and technical efficiency change. The empirical results show that while each sector displays quite different growth patterns, productivity growth is dominated by technological change. Technological change is found to have a negative correlation with efficiency change. Secondary regression performed in this study identifies the relationship between productivity growth measures and several key policy variables, such as effective protection rate, market concentration, and so forth. The productivity estimates are compared with those of the conventional Törnqvist productivity index.     

Economic liberalization and sources of productivity growth in Indonesian Banks: is it efficiency improvement or technological progress?

This article investigates the sources of productivity growth in the Indonesian banking sector during 23 years period from 1993 to 2015. The industry has gone through several episodes of policy reforms, starting from the radical deregulation in the late 1980s, the restructuring period following the 1997 Asian financial crisis, the consolidation period in the mid-2000s to the economic expansion in the 2010s. Using panel data of 98 commercial banks, we explore productivity growth using Malmquist indices complemented with bootstrapping technique to provide measures of the statistical precision of the results. The Malmquist index measures total factor productivity, efficiency change and technological change. Results show that productivity improves moderately and appears to be less volatile towards the end of the period. Furthermore, efficiency change tends to be the main source of productivity improvement rather than technological change.     

中国商业银行全要素生产率及其影响因素的实证研究——基于DEA的Malmquist生产率指数法

利用2004—2009年我国15家商业银行的面板数据,运用基于DEA的Malmquist生产率指数法,测算了商业银行的Malmquist生产率指数及其分解指数。结果显示:我国商业银行的全要素生产率整体呈下降趋势,其中,技术进步指数的下降幅度较大,纯技术效率变化指数和规模效率变化指数略有升高。在此基础上,对影响我国商业银行全要素生产率的因素进行了分析。实证结果表明:进出口总额和货币供应量增长率对我国商业银行全要素生产率的提升有正向作用,国内生产总值和全社会固定资产投资有显著的负向作用。     

中国商业银行全要素生产率分析——基于三阶段Malmquist指数模型

本文运用三阶段Malmquist指数对我国商业银行2004—2008年的全要素生产率变化情况进行研究。研究结果表明,环境变量对我国商业银行的投入变量有显著的影响,传统的Malmquist方法高估了我国商业银行全要素生产率变化指数、技术进步变化指数以及技术效率变化指数;我国银行业在2004—2008年间出现了全要素生产率的改进,这主要源于技术进步的作用;金融危机的爆发使得我国银行业整体生产率大幅度下降,但对国有商业银行的影响要小于对股份制商业银行的影响。     

A note on productivity change in European cooperative banks: the Luenberger indicator approach

The Luenberger productivity indicator is employed to estimate and decompose productivity change in a sample of cooperative banks operating in 10 EU member states. An average annualised productivity growth of 2.59% is reported between 1996 and 2003, though there is heterogeneity in growth rates across countries. Generally speaking, productivity growth is driven by technological change. However, cooperative banks in southern European banking markets benefit as much from efficiency growth or catching‐up with industry best practice. The results suggest that technology sharing arrangements and greater competition arising from deregulation are positive contributors towards productivity change.     

中国区域绿色发展效率与绿色全要素生产率：2000—2010——基于参数共同边界的实证研究

本文运用参数化共同边界与Luenberger生产率指标相结合的方法,研究环境约束下2000—2010年中国区域绿色发展效率和绿色全要素生产率增长。实证结果表明,与中西部地区相比,东部地区不仅绿色发展效率高,而且生产技术水平更加贴近潜在水平;总体上,东部地区绿色全要素生产率是进步的,而中西部地区却表现出负增长的现象,东部地区效率变化和技术进步的表现皆优于中西部地区.进一步的分解结果显示,纯技术进步成为了推动我国绿色全雩素生产率增长的主要动力,而纯效率变化的贡献较小甚至对生产率增长产生消极的作用;从纯粹技术追赶来看,东部地区的生产技术不断靠近潜在生产技术,而中西部地区则表现出生产技术愈发落后于潜在水平的趋势;潜在技术相对变动方面,三大区域都表现出技术发展空间不断压缩的现象。     

Cost metafrontier approach for measuring the Malmquist productivity index: An example of bank groups formed after the financial reform in Taiwan

This study attempts to provide a framework under the variable returns to scale hypothesis to account for the effect of the cost scale efficiency change in the decomposition of the cost metafrontier Malmquist productivity index (CMMPI). In addition, the meta‐cost efficiency and cost frontier gap between subordinate banks of financial holding companies (FHC) and independent banks are also examined. A total of 34 banks in Taiwan are empirically analysed from 1999 to 2012. The results indicate that the meta‐cost efficiency, meta‐technical efficiency and meta‐allocative efficiency scores of subordinate banks of FHC are better than those of independent banks. The banking industry in Taiwan is found to have an improvement in cost metafrontier Malmquist productivity. The subordinate banks of FHC are also found to exhibit positive CMMPI and decomposition components, but do not achieve a significant improvement except in the case of the technical gap ratio change. The empirical results recommend that Taiwanese banks place more policy focus on the issue of scale adjustment, which should be beneficial. Based on the CMMPI decomposed results, we can gain further understanding of the growth path to enhance operational performance.     

中国城市绿色全要素生产率测度研究

基于考虑"能源消耗"与"环境污染"的超效率SBM模型,采用全局参比的Globe-Malmquist-Luenberger(GML)指数测算中国283个城市的绿色全要素生产率(GTFP)。研究发现:(1)城市绿色全要素生产率、技术效率和技术进步分别以年均3.5%、1.2%和2.3%的速度增长,GTFP的增长动力主要来源于技术进步,而作为"绿色软技术"的技术效率贡献相对不足;(2)三大区域绿色全要素生产率平均增幅东部>中部>西部,技术进步差异是GTFP区域差距形成的主要原因,不同时期区域发展战略和环境政策在城市绿色转型中的作用存在异质性;(3)超大及特大城市、行政等级较高的城市绿色全要素生产率增长具有领先优势,且研究期内不同层级城市GTFP差距呈现先缩小后扩大的趋势。     

Total factor productivity change of MENA microfinance institutions: A Malmquist productivity index approach

The main purpose of this paper is to investigate productivity changes of 33 Middle East and North Africa microfinance institutions over the period of 2006–2011 by using the Malmquist productivity index (MPI) method and a balanced panel dataset of 198 observations. The empirical findings indicate that the microfinance industry has reported overall productivity regress in the study period even though all the MENA MFIs have positive TFP growth with the exception of the year 2010–2011. In addition, our study indicates that over the period the Malmquist productivity change experienced by the MENA microfinance industry as a whole has averaged 4.9% annually which was mainly attributed to technical efficiency change. The study reveals also that the industry as a whole has exhibited a decline in technological change (2.9% decrease over the period) and suggested that there has been a deterioration in the performance of the best practicing MFIs. By decomposing the Malmquist index, the result showed that during the study period the MENA MFIs have experienced mainly an increment of pure technical efficiency (improvement in management practices) rather than an improvement in optimum size. Overall, an essential strategic implication for the MENA microfinance industry is that they need to pursue a technological progress in order to meet the dual objectives of reaching many poor people and financial sustainability.     

Ownership,competition, and bank productivity: An analysis of Indian banking in the post-reform period

This paper investigates the effect of ownership and competition on Indian bank productivity since the 1991 reforms. We find that Indian private banks dominate the public and foreign banks both in terms of productivity levels and productivity growth, with the new Indian private banks leading the charge. Competition has a positive impact on productivity for the old Indian private banks, and all the other banks are hurt by competition — the worst hit being new Indian private banks. A similar picture emerges on the productivity growth side, with the new Indian private bank productivity growth being the worst affected as competition increases. An analysis of the pre- and post-1998 periods shows that the latter period displays a much higher productivity gap between the Indian private banks and the public and foreign banks. Indian private bank productivity and productivity growth suffer due to increasing competition in the post-1998 period.     

Economic reforms,efficiency and productivity in Chinese banking

This paper analyzes the impact of banking reforms on efficiency and total factor productivity (TFP) change in Chinese banking industry. Using an input distance function, we find that joint-equity banks are more efficient than wholly state-owned banks (WSOBs). Furthermore, both WSOBs and joint-equity banks are found to be operating slightly below their optimal size, suggesting potential advantages in expansion of their businesses. Overall, TFP growth was 4.4% per annum for the sample period 1993–2002. Joint-equity banks experienced much higher growth in TFP (5.5% per annum) compared to the WSOBs (1.4% per annum).      

Efficiency and credit rating in Taiwan banking: data envelopment analysis estimation

In this article, we use the data envelopment analysis to measure the efficiency of banks before and after credit rating is taken into consideration and we also employ the Malmquist Productivity Index to measure the total factor productivity changes from 2001 to 2003. The results are as follows: (1) There is a positive relationship between the efficiency scores and credit rating, and thus, the credit rating can be a representative to evaluate the performance and quality of a bank; (2) We use the Wilconxon two-sample test of nonparametric statistic to test the influences of credit rating. The empirical result shows that the credit rating is proven to influence the efficiency of banks; (3) The efficiency scores improve in both investment grade (above tw BBB?) and speculation grade (under tw BBB?), when credit rating is taken into consideration. The empirical results show that the efficiency scores of banks with a high credit rating improved relatively more when compared to banks with a lower credit rating; (4) In this research we also adopt the Malmquist index to observe the productivity and efficiency changes from year to year. We obtain results whereby the improvement of efficiency may be influenced greatly both from pure technical and scale efficiency changes.     

Do Listed Banks have Higher Operating Efficiency and Output Efficiency?

This paper investigates the efficiency and productivity of listed and non‐listed banks in China by using the meta‐frontier and GMMPI methods. We find that the improvement in productivity of listed and non‐listed banks is mainly due to changes in technological efficiency. The difference between them is that the improvement of productivity of listed banks presents a typical technology‐driven feature, and changes in scale efficiency negatively affect productivity. The productivity of non‐listed banks shows scale efficiency driving features. The meta‐frontier efficiency of listed banks is significantly higher than the others. After decomposing the technology gap ratio, we find that the current production technology of the listed banks is closer to the potential production technology frontiers, and there is space for the non‐listed banks to improve their efficiency. Besides, the gaps between the true extent and the potential technological frontiers of both listed banks and non‐listed banks have converged.     

Size,Non-Performing Loan,Capital and Productivity Change: Evidence From Indian State-Owned Banks

While the relationship between portfolio risk and capital and its interrelationship with operating efficiency has been extensively studied, little work has been forthcoming on the interrelationships among credit risk, capital and productivity change. The paper makes an attempt to examine the same in the Indian context. Using data on state-owned banks (SOBs) for the period 1995–96 through 2000–2001, the paper finds capital, risk and productivity change to be intertwined, with each reinforcing and to a degree, complementing the other. The results imply that inadequately capitalized banks have lower productivity and are subject to a higher degree of regulatory pressure than adequately capitalized ones. Finally, the results lend support, especially for medium-sized banks, to the belief that lowering Government ownership tends to improve productivity.

     

FACTOR ACCUMULATION OR TFP? A REASSESSMENT OF GROWTH IN SOUTHEAST ASIA

Abstract.  This paper reassesses economic growth in five South-East Asian countries utilizing a non-parametric productivity index and parametric techniques to trace the ultimate source/s of growth. Our results show that there is no single explanation for the growth performance of the countries in our sample. The results, particularly with reference to the role of embodied technology are comforting in terms of policy implications for countries such as Singapore, where, given the capital output ratios, there are lower returns to future capital accumulation. The possibility of capital being embodied through technological change makes future prospects much brighter for such a country.     

我国专利密集型产业绿色全要素生产率测度及收敛性研究

基于2007—2017年专利密集型产业面板数据,运用GML指数模型测度专利密集型产业8个行业的绿色全要素生产率,并对其进行收敛性分析。研究发现,专利密集型产业绿色全要素生产率整体水平较高,与传统全要素生产率相比,“波特假说”初步显现;总体上,专利密集型产业绿色全要素生产率呈上升趋势,技术进步贡献最大,不同行业的绿色全要素生产率增长水平和动态趋势不尽相同;整体行业、强专利密集型行业和弱专利密集型行业绿色全要素生产率内部差距仍然较大,整体行业与强专利密集型行业趋向共同稳态和自身稳态收敛,弱专利密集型行业仅趋向自身稳态收敛;行业集中度、行业规模对行业整体和弱专利密集型行业绿色全要素生产率具有正向作用,研发投入对强专利密集型行业绿色全要素生产率具有显著正向作用。