IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Are cooperatives the weakest link in European banking? A non-parametric metafrontier approach

  • Kontolaimou, Alexandra
  • Tsekouras, Kostas

This paper investigates the productive performance of cooperative banking firms as compared to their commercial and savings counterparts, accounting for technology heterogeneity due to different ownership in European banking. Based on the metafrontier notion, we introduce a methodology which allows the identification of technology gaps among different bank types and their decomposition into input- and output-invariant components. Our findings suggest that the type-specific frontier corresponding to cooperative banking firms lies, to its largest part, away from the European metafrontier. Furthermore, within the cooperative bank type a dichotomy seems to arise. The decomposition results suggest that the cooperatives' technology gap is attributed to output production rather than input use.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/B6VCY-4Y4R49T-3/2/43d596d9e9cc5a13cd7bfe3f5cd7db73
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Journal of Banking & Finance.

Volume (Year): 34 (2010)
Issue (Month): 8 (August)
Pages: 1946-1957

as
in new window

Handle: RePEc:eee:jbfina:v:34:y:2010:i:8:p:1946-1957
Contact details of provider: Web page: http://www.elsevier.com/locate/jbf

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. D.S. Prasada Rao & Christopher J. O'Donnell & George E. Battese, 2003. "Metafrontier Functions for the Study of Inter-regional Productivity Differences," CEPA Working Papers Series WP012003, School of Economics, University of Queensland, Australia.
  2. Kamal Saggi, 2002. "Trade, Foreign Direct Investment, and International Technology Transfer: A Survey," World Bank Research Observer, World Bank Group, vol. 17(2), pages 191-235, September.
  3. Mester, Loretta J., 1991. "Agency costs among savings and loans," Journal of Financial Intermediation, Elsevier, vol. 1(3), pages 257-278, June.
  4. Kostas Tsekouras & Dimitris Skuras & Irene Daskalopoulou, 2008. "The role of productive efficiency on entry and post-entry performance under different strategic orientation: the case of the Greek plastics and rubber industry," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 29(1), pages 37-55.
  5. Loretta J. Mester, 1992. "Efficiency in the savings and loan industry," Working Papers 92-14, Federal Reserve Bank of Philadelphia.
  6. Cowan, Robin & David, Paul A & Foray, Dominique, 2000. "The Explicit Economics of Knowledge Codification and Tacitness," Industrial and Corporate Change, Oxford University Press, vol. 9(2), pages 211-53, June.
  7. Edwards, Franklin R, 1977. "Managerial Objectives in Regulated Industries: Expense-Preference Behavior in Banking," Journal of Political Economy, University of Chicago Press, vol. 85(1), pages 147-62, February.
  8. Wilko Bolt & David Humphrey, 2008. "Bank Competition Efficiency in Europe: A Frontier Approach," DNB Working Papers 194, Netherlands Central Bank, Research Department.
  9. Allen N. Berger & David B. Humphrey, 1997. "Efficiency of Financial Institutions: International Survey and Directions for Future Research," Center for Financial Institutions Working Papers 97-05, Wharton School Center for Financial Institutions, University of Pennsylvania.
  10. Nilsson, Jerker, 2001. "Organisational principles for co-operative firms," Scandinavian Journal of Management, Elsevier, vol. 17(3), pages 329-356, September.
  11. Kauko, Karlo, 2007. "Managers and efficiency in banking," Research Discussion Papers 11/2007, Bank of Finland.
  12. Iftekhar Hasan & Ana Lozano, 1999. "Organizational Form and Expense Preference: Spanish Experience," New York University, Leonard N. Stern School Finance Department Working Paper Seires 99-068, New York University, Leonard N. Stern School of Business-.
  13. Novkovic, Sonja, 2008. "Defining the co-operative difference," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(6), pages 2168-2177, December.
  14. Kounetas, Konstantinos & Mourtos, Ioannis & Tsekouras, Konstantinos, 2009. "Efficiency decompositions for heterogeneous technologies," European Journal of Operational Research, Elsevier, vol. 199(1), pages 209-218, November.
  15. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
  16. Koetter, Michael & Poghosyan, Tigran, 2009. "The identification of technology regimes in banking: Implications for the market power-fragility nexus," Journal of Banking & Finance, Elsevier, vol. 33(8), pages 1413-1422, August.
  17. Fotios Pasiouras, 2008. "International evidence on the impact of regulations and supervision on banks’ technical efficiency: an application of two-stage data envelopment analysis," Review of Quantitative Finance and Accounting, Springer, vol. 30(2), pages 187-223, February.
  18. Claudia Girardone & John C. Nankervis & Ekaterini-Fotini Velentza, 2009. "Efficiency, ownership and financial structure in European banking: A cross-country comparison," Managerial Finance, Emerald Group Publishing, vol. 35(3), pages 227-245.
  19. Barbara Casu & Philip Molyneux, 2000. "A Comparative Study of Efficiency in European Banking," Center for Financial Institutions Working Papers 00-17, Wharton School Center for Financial Institutions, University of Pennsylvania.
  20. George Battese & D. Rao & Christopher O'Donnell, 2004. "A Metafrontier Production Function for Estimation of Technical Efficiencies and Technology Gaps for Firms Operating Under Different Technologies," Journal of Productivity Analysis, Springer, vol. 21(1), pages 91-103, January.
  21. Rasmusen, Eric, 1988. "Mutual Banks and Stock Banks," Journal of Law and Economics, University of Chicago Press, vol. 31(2), pages 395-421, October.
  22. Borgen, Svein Ole, 2004. "Rethinking incentive problems in cooperative organizations," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 33(4), pages 383-393, September.
  23. Audretsch, David B., 1995. "Innovation, growth and survival," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 441-457, December.
  24. Dosi, Giovanni, 1982. "Technological paradigms and technological trajectories : A suggested interpretation of the determinants and directions of technical change," Research Policy, Elsevier, vol. 11(3), pages 147-162, June.
  25. AfDB AfDB, . "AfDB Group Annual Report 2006," Annual Report, African Development Bank, number 62 edited by Koua Louis Kouakou.
  26. Bos, J.W.B. & Schmiedel, H., 2007. "Is there a single frontier in a single European banking market?," Journal of Banking & Finance, Elsevier, vol. 31(7), pages 2081-2102, July.
  27. Carlsson, Bo & Jacobsson, Staffan & Holmen, Magnus & Rickne, Annika, 2002. "Innovation systems: analytical and methodological issues," Research Policy, Elsevier, vol. 31(2), pages 233-245, February.
  28. Akella, Srinivas R. & Greenbaum, Stuart I., 1988. "Savings and loan ownership structure and expense-preference," Journal of Banking & Finance, Elsevier, vol. 12(3), pages 419-437, September.
  29. Gropper, Daniel M. & Hudson, Carl D., 2003. "A note on savings and loan ownership structure and expense preference: A re-examination," Journal of Banking & Finance, Elsevier, vol. 27(10), pages 2003-2014, October.
  30. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-25, June.
  31. Asaftei, Gabriel, 2008. "The contribution of product mix versus efficiency and technical change in US banking," Journal of Banking & Finance, Elsevier, vol. 32(11), pages 2336-2345, November.
  32. Hayami, Yujiro & Ruttan, Vernon W, 1970. "Agricultural Productivity Differences Among Countries," American Economic Review, American Economic Association, vol. 60(5), pages 895-911, December.
  33. Christopher O’Donnell & D. Rao & George Battese, 2008. "Metafrontier frameworks for the study of firm-level efficiencies and technology ratios," Empirical Economics, Springer, vol. 34(2), pages 231-255, March.
  34. Bert Balk, 2001. "Scale Efficiency and Productivity Change," Journal of Productivity Analysis, Springer, vol. 15(3), pages 159-183, May.
  35. Jonathan Williams & Edward Gardener, 2003. "The Efficiency of European Regional Banking," Regional Studies, Taylor & Francis Journals, vol. 37(4), pages 321-330.
  36. Maudos, Joaquin & Pastor, Jose M. & Perez, Francisco & Quesada, Javier, 2002. "Cost and profit efficiency in European banks," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 12(1), pages 33-58, February.
  37. Goddard, John & Molyneux, Philip & Wilson, John O.S. & Tavakoli, Manouche, 2007. "European banking: An overview," Journal of Banking & Finance, Elsevier, vol. 31(7), pages 1911-1935, July.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eee:jbfina:v:34:y:2010:i:8:p:1946-1957. See general 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: (Zhang, Lei)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.