An Assessment of Portuguese Bank's Costs and Efficiency
AbstractThis paper analyses the production technology of Portuguese banks during the 1992-2004 period through the estimation of a translog cost frontier. Banks are modelled as firms which produce loans and other earning assets, choosing the cost minimizing combination of labour, capital and interest bearing debt, subject to holding a predetermined level of equity. According to the results of this study, technological progress has shifted the cost frontier downwards throughout the period under consideration, whereas banks seem to have operated at the same distance�� from the frontier. Further, increases in production under scale economies have also contributed to the recorded increase in productivity.
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Bibliographic InfoPaper provided by Banco de Portugal, Economics and Research Department in its series Working Papers with number w200922.
Date of creation: 2009
Date of revision:
Find related papers by JEL classification:
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
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