The Impact of Risk on Banks’ Technical and Scale Efficiency: Empirical Evidence from the Chinese Banking Sector
AbstractBy employing the Data Envelopment Analysis (DEA) method, this paper attempts to examine the impact of risks on Chinese banks’ technical and scale efficiency estimates. To do so, it follows the procedures set by Drake and Hall (2003) to include risk factor as a non-discretionary input variable. The empirical findings suggest that scale inefficiency has greater influence than pure technical inefficiency in determining the Chinese banking sector’s total technical efficiency. The results suggest that potential economies of scale are overestimated in the range of 22% to 30% when the risk factor is excluded. Moreover, the inclusion of risk factor benefits the city commercial banks the most, and the joint-stock commercial banks the least.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by IUP Publications in its journal The IUP Journal of Financial Economics.
Volume (Year): VIII (2010)
Issue (Month): 1 & 2 (March & June)
Contact details of provider:
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (G R K Murty).
If references are entirely missing, you can add them using this form.