productivity in swedish electricity retail distribution this paper examines productivity growth in electricity retail distribution in sweden in a multiple output multiple input framework the approach used is nonparametric data envelopment analysis dea productivity is measured by means of the malmquist index productivity comparisons are made between different types of ownership and between different service areas the study indicates a high rate of productivity growth due to economies of density when measured over a period of 17 years the results show no significant differences in productivity growth between different types of ownership or economic organization

banking technology and the existence of a consistent output aggregate abstract this paper addresses the question of the existence of a consistent output aggregate in banking specific necessary and sufficient conditions for output aggregation are developed and tested in the context of a second order approximation to any arbitrary multi product bank cost function the analysis provides evidence that a composite aggregate measure of output fails to provide a proper representation of banking technology and therefore previous studies that used aggregate output measures may well be subject to specification errors

efficiency analysis in banking firms an international comparison abstract the intensive process of financial european integration together with the profound transformation and deregulation that has taken place in the spanish banking system justifies the evaluation of its efficiency in comparison with that of other banking systems in this context the aim of this study is to analyze the productivity efficiency and differences in technology of several banking systems using a non parametric approach together with the malmquist index we compare the efficiency productivity and differences in technology of different european and us banking systems for the year 1992

turkish bank efficiency bayesian estimation with undesirable outputs this paper analyzes the productivity and efficiency of turkish banks from 2002 to 2010 we obtained estimates of efficiency productivity growth and efficiency growth using a bayesian stochastic frontier approach and focused on accounting for non performing loans npls for use in our model specifically we introduce npls as a bad output in an input distance function and estimate a system of non linear equations subject to endogeneity we confirm that the productivity growth of turkish banks was positive over the period of this study which was mainly due to the improvement in technology while efficiency growth continued to be negative over the same period methodologically we also prove that not accounting for npls in estimating the frontier model might seriously distort the efficiency and productivity results the study also provides measures of shadow prices for npl and discusses the results in terms of several interesting trends in turkish banking finally the paper provides efficiency and productivity comparisons between domestic and foreign banks

the nonparametric risk adjusted efficiency measurement an application to taiwan s major rural financial intermediaries in this article a nonparametric approach is used to incorporate risk into the measurement of technical efficiencies of the major financial intermediaries in rural taiwan risk is treated as a joint but undesirable output given the fact that various regulatory actions may prevent its free disposability three risk indicators nonperforming loans allowance for loan losses and risky assets are employed alternatively in the empirical work results suggest that all three risk constraints are binding regulations on controlling risky assets and loan loss reserves are effective but more burdensome than those on controlling loan quality

detecting abnormal credit union performance abstract credit unions are an important financial intermediary but little credit union research is done a primary reason for the lack of research is the cooperative nature of the industry making traditional methods of detecting abnormal performance inappropriate this paper proposes two methods of detecting abnormal performance one parametric the other non parametric instead of testing the efficiency of the institution this paper proposes testing the return vector as indicated in the theoretical objective function of the member simulations demonstrate that both methods are correctly specified and powerful

foreign bank entry deregulation and bank efficiency lessons from the australian experience abstract this study considers the impact of foreign bank entry on banking efficiency in australia during the post deregulation period 1988 2001 using data envelopment analysis malmquist indices and stochastic frontier analysis we find foreign banks more efficient than domestic banks which however did not result in superior profits major australian banks have used size as a barrier to entry to new entrants furthermore bank efficiency has increased post deregulation and the competition resulting from diversity in bank types was important to prompt efficiency improvements finally the recession of the early 1990s resulted in a distinct shift in the process of efficiency changes

trade facilitation and manufactured exports is africa different summary trade facilitation defined as reducing the transaction costs associated with the enforcement regulation and administration of trade policies has been at the forefront of discussions on policy measures for reducing the costs of exporting and importing in developing countries this study uses a new panel dataset for 124 developed and developing countries available for the period 2003 04 to assess the impact of trade facilitation and other trade related institutional constraints on manufacturing export performance with particular reference to africa we estimate a standard gravity model augmented with trade facilitation regulatory quality and infrastructure indicators our results show that trade facilitation reforms could contribute to improve export performance in africa but other reforms including the quality of the regulatory environment and the quality of the basic transport and communications infrastructure are also needed furthermore improvements in on the border and behind the border policies yield a higher return in terms of increasing manufacturing export performance in african countries than in the rest of the world

sensitivity analysis of efficiency and malmquist productivity indices an application to spanish savings banks abstract hypothesis testing and statistical precision in the context of non parametric efficiency and productivity measurement have been investigated since the early 1990s recent contributions focus on this matter through the use of resampling methods i e bootstrapping techniques however empirical evidence is still practically non existent this gap is more noticeable in the case of banking efficiency studies where the literature is immense in this work we explore productivity growth and productive efficiency for spanish savings banks over the initial post deregulation period 1992 1998 using data envelopment analysis dea and bootstrapping techniques results show that productivity growth has occurred mainly due to improvement in production possibilities and that mean efficiency has remained fairly constant over time the bootstrap analysis yields further evidence as for many firms productivity growth or decline is not statistically significant with regard to efficiency measurement the bootstrap reveals that the disparities in the original efficiency scores of some firms are lessened to a great extent

non radial cost luenberger productivity indicator abstract this study decomposes cost inefficiency into technical and allocative components in a more general way based on the directional russell measure drm of fukuyama and weber 2009 with the allocative component being completely clear of technical inefficiency based on this decomposition we develop a cost oriented productivity indicator the cost luenberger productivity indicator cl which completely embraces the concept of cost minimization and provides four sources of productivity change technical efficiency change the change in allocative efficiency the shift of technology and the effect of input price change to illustrate the above decompositions of cost inefficiency and productivity change and to investigate whether the establishment of a financial holding company fhc offers a bank greater operating efficiency and an improvement in productivity change this study employs data on taiwan s banking industry covering the period 2006 2012

market access conditions and sub saharan africa s exports diversification summary despite some progress in the last decade sub saharan africa s participation in the global economy remains generally limited and poorly diversified among the various reasons behind the lack of competitiveness of sub saharan africa exports this paper analyzes whether changes in market access conditions affect export diversification the findings of this paper indicate that market access conditions remain important and that the presence of trade relationships depends not only on favorable market access conditions but also on how these compare relative to foreign competitors these results imply that freer trade within sub saharan african countries could provide significant incentive to intra regional trade

measuring energy efficiency in the context of an emerging economy the case of indian manufacturing in recent years the indian economy has achieved a rapid growth rate however one of the challenges facing the economy is the large energy supply that would be needed to sustain this growth path hence attaining energy efficiency is crucial for the economy this paper examines the indian manufacturing sector and utilizes a variant of the directional distance function to obtain comprehensive measures of performance of the major manufacturing states given the joint goals of achieving energy conservation and output growth the results of the empirical application reveal that given the prevailing technology the average manufacturing firm across the states could reduce energy input and increase output simultaneously by an annual average of 3 84 by improving technical efficiency to accommodate a larger simultaneous increase in output and reduction in energy use india should adopt superior technologies so as to shift the efficient frontier outward

the evolution of cost productivity and efficiency among us credit unions abstract advances in information processing technology have eroded the advantages of small scale and proximity to customers that traditionally enabled small lenders to thrive nonetheless the membership and market share of us credit unions have increased though their average size has also risen we investigate changes in the efficiency and productivity of us credit unions during 1989 2006 by benchmarking the performance of individual firms against an estimated order quantile lying near the efficient frontier we construct a cost analog of the malmquist productivity index which we decompose to estimate changes in cost and scale efficiency and changes in technology we find that cost productivity fell on average across all credit unions but especially among smaller credit unions smaller credit unions confronted a shift in technology that increased the minimum cost required to produce given amounts of output all but the largest credit unions also became less scale efficient over time

controlling for the use of extreme weights in bank efficiency assessments during the financial crisis we propose a method for bank efficiency assessment based on weight restricted dea that limits banks abilities to use extreme weights corresponding to extreme judgements of the risk adjusted prices on funding sources and assets based on a data set comprising the largest european banks during the financial crisis we illustrate the impact of the proposed weight restrictions in two different efficiency models one related to banks funding mix and one related to their asset mix the results show that using a more balanced set of weights tend to reduce the estimated efficiency scores more for those banks which were bailed out during the crisis which confirms the potential bias within standard dea that does not control for extreme weights applied by highly risky banks we discuss the use of the proposed method as a regulatory tool to constrain discretion when complying with regulatory capital benchmarks such as the basel regulatory capital ratios

are credit unions too small abstract u s credit unions serve 93 million members hold 10 of u s savings deposits and make 13 2 of all nonrevolving consumer loans since 1985 the share of u s depository institution asse

localized market power in the u s airline industry this paper tests whether the observed dominance of most city pair markets and airports in the u s domestic airline industry by single carriers confers any pricing power on the dominan t firms the results of fixed effects estimation indicate that airport dominance by a carrier does confer upon it substantial pricing power whereas dominance at the route level seems to confer no such pricing power additionally the authors find a positive yet small correlation between both route concentration and price and airport concentration and price the quantitative importance of airport dominance reveals that the most promising direction for public polic y aimed at improving the industry s performance is to ensure equal acc ess to sunk airport facilities copyright 1993 by mit press

an economic theory of a credit union the majority of research to date on cus has been empirical cf cargill 1 and kidwell and peterson 7 yet there is serious need to develop a theoretical framework of cu behavior that incorporates their unique characteristics a cu is essentially a financial intermediation cooperative however the standard theoretical treatments of financial intermediaries cf meyer 8 and cooperative enterprises cannot be directly applied to model credit union behavior there are two principal characteristics of cus that prevent this first in a cu and cooperatives in general the members are both the owners of the organization and the consumers of its output or suppliers of its input one cannot simply assume that the members seek to maximize the profit generated by their transactions with the cu irrespective of the price and quantities of those same transactions thus models of a financial firm based on profit maximization cannot be directly translated to a cu environment second in a cu the membership provides both the demand for and supply of loanable funds the cu then intermediates between its member savers and member borrowers this heterogeneity is an inherent source of conflict between members clearly a cu cannot simultaneously maximize its dividend rate for savers and minimize its loan rate for borrowers since most theoretical models of cooperative enterprises assume a homogeneous member objective they are not generally applicable to cus there are two basic requirements for a framework to model cu behavior first the specification of the objective function should focus on the value of cu participation to the members this value should include the prices and quantities of transactions as well as any profit that results second the analysis should explicitly consider the possibility of conflict among members and the resolution of that conflict being a preference to either the borrowers or savers the existing literature on cus contains a wide variety of objective functions hempel and yawitz 5 ignore the owners are consumers issue and simply contend that cus like other financial intermediaries should maximize profit most writers however recognize that profit maximization would be a somewhat incongruous objective for an organization that typically labels itself not for profit murray and white 9 use cost minimization subject to an output constraint keating 6 employs the managerial discretion approach by maximizing the manager s utility function subject to minimum member benefit constraints taylor 11 12 suggests that the cu should minimize the difference between its average loan rate and savings rate paid smith 10 argues that the cu should

export performance and trade facilitation reform hard and soft infrastructure summary we estimate the impact of aggregate indicators of soft and hard infrastructure on the export performance of developing countries we derive four new indicators for more than 100 countries over the period 2004 07 estimates show that trade facilitation reforms do improve the export performance of developing countries this is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment the findings provide evidence that the marginal effect of the transport efficiency and business environment improvement on exports appears to be decreasing in per capita income in contrast the impact of physical infrastructure and information and communications technology on exports appears increasingly important the richer a country becomes we also find statistical evidence on the complementarity between hard infrastructure and soft infrastructure as captured by our indicators finally drawing on estimates we compute illustrative ad valorem equivalents of improving each indicator halfway to the level of the top performer in the region

comparing malmquist and hicks moorsteen productivity indices exploring the impact of unbalanced vs balanced panel data abstract we explore the effect of balancing unbalanced panel data when estimating primal productivity indices using non parametric frontier estimators first we list a series of pseudo solutions aimed at making an unbalanced panel balanced then we discuss some intermediate solutions e g balancing 2 years by 2 years furthermore we link this problem with a variety of literatures on infeasibilities statistical inference of non parametric frontier estimators and the index theory literature focusing on the dynamics of entry and exit in industries we then empirically illustrate these issues comparing both malmquist and hicks moorsteen productivity indices on two data sets in particular we test for the differences in distribution when comparing balanced and unbalanced results for a given index and when comparing malmquist and hicks moorsteen productivity indices for a given type of data set the latter tests are crucial in answering the question to which extent the malmquist index can approximate the hicks moorsteen index that has a total factor productivity tfp interpretation finally we draw up a list of remaining issues that could benefit from further exploration

the dominance of inefficiencies over scale and product mix economies in banking abstract this study measures and analyzes inefficiencies for all u s banks in 1984 inefficiencies are measured relative to a thick frontier cost function and are found to dominate measured scale and product mix economies most inefficiencies are operational in nature involving the overuse of physical inputs rather than financial involving overpayment of interest also technical inefficiencies proportionate overuse of all inputs dominate allocative inefficiencies improper mix of inputs these results suggest that competitive pressures in banking from deregulation will be focused primarily on banks that do not control costs rather than on those of a particular size or product mix

what explains the low survival rate of developing country export flows successful export growth and diversification require not only entry into new export products and markets but also the survival and growth of export flows this paper uses a detailed cross country dataset of product level bilateral export flows to illustrate that exporting is an extremely perilous activity and especially so in low income countries the authors find that unobserved individual heterogeneity in product level export flow data prevails despite controlling for a wide range of observed country and product characteristics this questions previous studies that have used the cox proportional hazards model to model export survival the authors estimate a prentice gloeckler model amended with a gamma mixture distribution summarizing unobserved individual heterogeneity the empirical results confirm the significance of a range of products as well as country specific factors in determining the survival of export flows from a policy perspective an interesting finding is the importance of learning by doing for export survival experience with exporting the same product to other markets or different products to the same market are found to strongly increase the chance of export survival a better understanding of such learning effects could substantially improve the effectiveness of export promotion strategies

productivity growth in large us commercial banks the initial post deregulation experience abstract we explore productivity growth for a group of 201 large us commercial banks over the initial post deregulation period from 1984 to 1990 using data envelopment analysis dea we measure productivity growth using malmquist productivity indexes and isolate the contributions of technical change technical efficiency change and scale change to productivity growth we find overall productivity growth at the rate of about 4 5 per year on average but productivity declined by 7 61 between 1984 and 1985 and by 0 33 between 1988 and 1989 our second stage panel regressions reveal that larger asset size and specialization of product mix associate with higher productivity growth while higher equity to assets associates with lower productivity growth

a theoretic framework for the analysis of credit union decision making this paper presents a formal theoretic framework to analyze credit union interest rates on loans and savings deposits the unique motivational and institutional features of a credit union in particular its structure as a financial service cooperative are used to develop the objective function this is based on a comparison of the credit union s rates to alternatively available market rates and includes parameters to recognize the possibility of borrower saver conflict the principal result is that the optimal rates and reactions to exogenous changes depend critically on the preference of the organization toward financial gain to the borrowing and saving members

industry performance and structural efficiency measures solutions to problems in firm models abstract it is shown that average unit structural efficiency measures do not measure the level of technical efficiency in a firm model of an industry alternative structural efficiency measures generalized to multiple input and multiple output technologies are presented as a solution to the problem of how to estimate the relative performance of an industry as a whole where reallocation of inputs across firms is not feasible compared to existing measures the proposed measures require additional information therefore the linear programming dea models needed to obtain this information are presented this non parametric approach to relative efficiency measurement is also used to obtain economic efficiency estimates for an industry as a whole without imposing a priori restrictions on the relative input and output weights

the growth of us credit unions abstract the growth of us credit unions during the 1990s is investigated empirically using univariate and multivariate cross sectional and panel estimation techniques univariate tests of the law of proportionate effect suggest that in general large credit unions grew faster than their smaller counterparts on average credit unions with above average growth in one period tended to experience below average growth in the next smaller credit unions tended to have more variable growth than large ones while credit unions share a common co operative philosophy they differ in terms of age profile scope for membership growth charter type and financial structure and performance in estimations of a multivariate growth model most of these characteristics are found to have a significant influence on the size growth relationship while large state chartered credit unions grew faster than their smaller counterparts the reverse was true for federally chartered credit unions in general if larger credit unions grew faster than smaller ones they tended to do so for specific reasons because their charters were less restrictive because they were more efficient or because they had a financial structure that was more conducive to growth therefore credit union growth was not random but highly systematic

the diversification and financial performance of us credit unions abstract for us credit unions revenue from non interest sources has increased significantly in recent years we investigate the impact of revenue diversification on financial performance for the period 1993 2004 the impact of a change in strategy that alters the share of non interest income is decomposed into a direct exposure effect reflecting the difference between interest and non interest bearing activities and an indirect exposure effect which reflects the effect of the institution s own degree of diversification on both risk adjusted and unadjusted returns measures a positive direct exposure effect is outweighed by a negative indirect exposure effect for all but the largest credit unions this may imply that similar diversification strategies are not appropriate for large and small credit unions small credit unions should eschew diversification and continue to operate as simple savings and loan institutions while large credit unions should be encouraged to exploit new product opportunities around their core expertise

rethinking trade preferences how africa can diversify its exports this paper argues that the contribution of trade preferences to economic development needs to be reappraised in light of the growth of globalised trade in manufactures trade preferences may be able to act as a catalyst for manufacturing exports leading to rapid growth in exports and employment to do so preferences need to be designed to be consistent with international trade in fragmented tasks as opposed to complete products and need to be open to countries with sufficient levels of complementary inputs such as skills and infrastructure recent experience with the african growth and opportunities act shows that in the right conditions sub saharan african countries have had large manufacturing export supply response to trade preferences

trends in relationship lending and factors affecting relationship lending efficiency abstract this paper investigates the efficiency of relationship managers at the canadian imperial bank of commerce cibc one of canada s largest banks data envelopment analysis dea efficiency scores are analyzed using regression the results demonstrate that managers are less efficient when facing larger numbers of loans or smaller loans m berlin and l j mester on the profitability and cost of relationship lending working paper no 97 43 the wharton school university of pennsylvania 1997 show that credit smoothing is generally suboptimal a more complete explanation is obtained by taking a micro level focus other results indicate that banks may improve profitability by reserving relationship lending for loans of larger size tests of relationships between efficiency and nonperforming loans and of the skimping hypothesis are conducted

the technical efficiency of us banks abstract the paper uses a non parametric frontier approach to measure the technical efficiency of a sample of u s banks the results indicate that these banks could have produced the same level of output with only 70 of the inputs actually used in addition most of this inefficiency is due to pure technical inefficiency wasting inputs rather than scale inefficiency operating at non constant returns to scale finally regression analysis indicates that the technical efficiency of the banks is positively related to size negatively related to product diversity and not at all related to the extent to which branch banking is allowed

power industry restructuring and eco efficiency changes a new slacks based model in malmquist luenberger index measurement measuring variations in efficiency and its extension eco efficiency during a restructuring period in different industries has always been a point of interest for regulators and policy makers this paper assesses the impacts of restructuring of procurement in the iranian power industry on the performance of power plants we introduce a new slacks based model for malmquist luenberger ml index measurement and apply it to the power plants to calculate the efficiency eco efficiency and technological changes over the 8 year period 2003 2010 of restructuring in the power industry the results reveal that although the restructuring had different effects on the individual power plants the overall growth in the eco efficiency of the sector was mainly due to advances in pure technology we also assess the correlation between efficiency and eco efficiency of the power plants which indicates a close relationship between these two steps thus lending support to the incorporation of environmental factors in efficiency analysis

undesirable outputs in efficiency valuations abstract efficiency measurement is usually based on the assumption that inputs have to be minimized and outputs have to be maximized in a growing number of applications however undesirable outputs are incorporated into the production model which have to be minimized in this paper various approaches for treating such outputs in the framework of data envelopment analysis dea are discussed and the resulting efficient frontiers are compared new radial measures are introduced which assume that any change of the output level will involve both undesirable and desirable outputs

energy and ghg emission efficiency in the chilean manufacturing industry sectoral and regional analysis by dea and malmquist indexes abstract global warming produced mainly by the emission of greenhouse gases is currently a worldwide concern in the last few decades since the 1950s many of the changes observed in the world climate have been meaningful this paper presents an analysis of energy efficiency and of greenhouse gas emissions in the chilean manufacturing industry by region and sector taking into consideration time sequences data envelopment analysis dea models are used for the analysis three ways to handle undesirable outputs are compared the source of inefficiency in each decision making unit dmu is calculated using scale efficiency and the evolution over time is analyzed using the malmquist index the results indicate that the industries located in the chilean regions of coquimbo la araucania and aysen were the most efficient while the industries in the regions of tarapaca antofagasta and biobio were less efficient the most efficient industrial sectors were those involving communications equipment base metals and clothing the least efficient were those concerned with food and beverages textiles and nonmetallic minerals due to the treatment of the undesirable outputs differences were found in the efficiency indexes obtained by the three models this finding suggests using a model better adapted to the characteristics of the outputs in question and the viability of improving industrial practices

malmquist indices of productivity growth during the deregulation of norwegian banking 1980 89 productivity growth during the deregulation of the norwegian banking industry is studied within the framework of data envelopment analysis which explicitly allows for multiple outputs introducing malmquist indices for productivity growth total growth can be decomposed into frontier growth and change in each bank s distance to the frontier both the total growth index and its components can be consistently chained over time we find productivity regress at the average bank prior to the deregulation but rapid growth when deregulation took place deregulation also led to less dispersion of productivity levels within the industry

indian bank efficiency and productivity changes with undesirable outputs a disaggregated approach the objective of this study is to examine technical efficiency and productivity growth in the indian banking sector over the period from 2004 to 2011 we apply an innovative methodological approach introduced by chen et al 2011 and barros et al 2012 who use a weighted russell directional distance model to measure technical inefficiency we further modify and extend that model to measure tfp change with npls we find that the inefficiency levels are significantly different among the three ownership structure of banks in india foreign banks have strong market position in india and they pull the production frontier in a more efficient direction spbs and domestic private banks show considerably higher inefficiency we conclude that the restructuring policy applied in the late 1990s and early 2000s by the indian government has not had a long lasting effect

what is the impact of bankrupt and restructured loans on japanese bank efficiency the japanese banking system provides a distinctive platform for the examination of the long lasting effect of problem loans on efficiency we measure technical efficiency by modifying a translog enhanced hyperbolic distance function with two undesirable outputs identified as problem loans and problem other earning assets our unique database allows us to distinguish between bankrupt and restructured loans to investigate the underlying causality between these loans and efficiency from the flexible panel vector autoregression specification primary results reveal that bankrupt loans have a positive impact on efficiency related to the moral hazard skimping hypothesis with the causality originating from bankrupt loans in contrast findings for the relationship between restructured loans and efficiency support the bad luck hypothesis

economies of diversification in the us credit union sector summary significant scale economies have been recently cited to rationalize a dramatic growth in the us retail credit union sector over the past few decades in this paper we explore another plausible supply side explanation for the growth of the industry namely economies of diversification we focus on the fact that credit unions differ among themselves in the range of financial services they offer to their members since larger credit unions tend to offer a more diversified financial service menu than credit unions of a smaller size the incentive to grow in size may be fueled not only by present scale economies but also by economies of diversification this paper provides the first robust estimates of such economies of diversification for the credit union sector we estimate a flexible semiparametric smooth coefficient quantile panel data model with correlated effects that is capable of accommodating a four way heterogeneity among credit unions our results indicate the presence of non negligible economies of diversification in the industry we find that as many as 27 91 depending on the type and the cost quantile of diversified credit unions enjoy substantial economies of diversification the cost of most remaining credit unions is invariant to the scope of services we also find overwhelming evidence of increasing returns to scale in the industry

institutions infrastructure and trade we work with a panel of bilateral trade flows from 1988 to 2002 exploring the influence of infrastructure institutional quality colonial and geographic context and trade preferences on the pattern of bilateral trade we are interested in threshold effects and so emphasize those cases where bilateral country pairs do not actually trade we depart from the institutions and infrastructure literature in this respect using selection based gravity modeling of trade flows we also depart from this literature by mixing principal components to condense our institutional and infrastructure measures with a focus on deviations from expected values for given income cohorts to control for multicollinearity infrastructure and institutional quality are significant determinants not only of export levels but also of the likelihood exports will take place at all our results support the notion that export performance and the propensity to take part in the trading system at all depends on institutional quality and access to well developed transport and communications infrastructure indeed this dependence is far more important empirically than variations in tariffs in explaining sample variations in north south trade this implies that policy emphasis on developing country market access instead of support for trade facilitation may be misplaced

tripling africa s primary exports what how where abstract income growth in africa that is high enough to achieve the internationally agreed development goals implies a rise in the region s per capita income by the early 2020s to about latin america s current level the paper shows that such income growth would be associated roughly with a nine fold increase in africa s manufactured exports but also with a tripling of its primary exports which in absolute terms would account for two thirds of the increase in the region s total exports focusing on the demand potential for such an increase in africa s primary exports the paper argues that rising global demand from sustained rapid growth in natural resource poor asian countries particularly china provides sizeable new opportunities for africa s primary exports in africa extractive industries are poised best to benefit directly from china s rising imports while exporters of agricultural products are more likely to benefit indirectly from rising world market prices associated with asia s growing prim

tourism and economic development a survey this article surveys the literature on tourism and economic development identifying the contribution that tourism can make to development including foreign currency income and employment and the costs that it entails single equation and system of equations models for estimating tourism demand are provided indicating developing countries potential to benefit from increasing expenditure on tourism but their susceptibility to deterioration in price competitiveness the main sectors of tourism supply transportation tour operators travel agents and accommodation are examined and the importance of cross country integration between firms is highlighted the article argues that many of the problems associated with the use of environmental resources for tourism stem from market failure and it considers methods for increasing sustainably the returns from them

determinants of bank market structure efficiency and political economy variables abstract this paper analyzes the influence of bank efficiency and political economy variables on bank market structure market share and market concentration using a panel data of 2 592 banks from 69 countries over the 1996 2002 period results indicate that the validity of the efficiency structure hypothesis to explain bank market structure varies across countries depending on national political economy variables in particular higher entry requirements more generous deposit insurance and higher extent of government bank ownership reduce the positive influence of bank efficiency on market share and market concentration however tighter restrictions on bank activities better quality of the contracting environment more market monitoring and more market orientation and development of the financial system increase the positive influence of bank efficiency on market share and market concentration jel classification g18 g21 g28 keywords banking structure efficiency regulations supervision institutions

total factor productivity growth technological progress and technical efficiency change dimensions of productivity change in yugoslavia 1965 1978 this article total factor productivity growth technological progress and technical efficiency change dimensions of productivity change in yugoslavia 1965 78 was reprinted with permission from the december 1982 issue of the economic journal this article proposes a methodology that decomposes total factor productivity change into two distinct elements technological progress and changes in technical efficiency technological progress is defined as the change in the best practice production frontier all other productivity change is attributed to technical efficiency change the article provides a theoretical framework for decomposing total factor productivity growth as well as a specification and estimation of the deterministic frontier production function it employs a programming technique to estimate a flexible functional form of the production frontier the paper then applies this technique to empirical data from yugoslavia of the period from 1965 to 1978 it concludes that for yugoslavia improvements to technical efficiency comprise the dominant contribution to total factor productivity change this agrees with accumulating evidence that in many developing economies productivity gain due to technological mastery of imported technology is substantial

the future of market regulation market regulation is accomplished both by competition and by external government agencies and the trend is toward greater reliance on competition economists have fostered this trend and have even invented markets to help overcome some externality problems they have contributed to a steady improvement in antitrust policy which currently reflects economic knowledge well they diagnosed and demonstrated problems with external regulation of the airline industry and gave assurance that regulation by competition could work in its place success there led not only to deregulation of airlines but also deregulation of railroads trucks buses and in some ways natural gas pipelines two other industries telecommunications and electricity are now following very ambitious paths toward less external regulation and greater dependence on competition the internet raises new issues but there also competition will play an important regulatory role

technical scale and allocative efficiencies in u s banking an empirical investigation a nonparametric frontier approach is used to calculate the overall technical pure technical allocative and scale efficiencies for a sample of 322 independent banks the sample was drawn from the federal deposit insurance corporation tapes on the reports of condition and reports of income call reports for the year 1986 the results indicated a low level of overall efficiency the main source of inefficiency was technical in nature rather than allocative separate efficiency frontiers were constructed to test the effect of branching however the distributions of efficiency measures for branching and non branching banks were not found to be different

graph efficiency and productivity measures an application to us agriculture hyperbolic measures of efficiency and productivity change with respect to a graph representation of production technology allow researchers to consider output and input dimensions simultaneously in measuring producer performance hyperbolic efficiency measures have been proposed but empirical implementation has not followed either in efficiency analysis or in productivity analysis the objectives of this paper are to define hyperbolic performance measures on a graph representation of production technology to motivate their use by stating some of their advantages over their radial counterparts and to introduce a direct formulation to calculate them making use of data envelopment analysis techniques the ideas are illustrated by calculating hyperbolic efficiency and malmquist productivity indexes for a us agricultural panel data set

productivity in multiple output public service a quadratic frontier function and malmquist index approach abstract the purpose of this study is to analyse the development of productivity and structural efficiency for an extended period of time 1974 to 1987 in the production of public social insurance services in sweden the analysis is based on the estimation of a deterministic flexible single input multiple output frontier production function the findings indicate a productivity decrease for the entire period from 1974 to 1987 of 18 percent in the period 1974 to 1982 productivity decreased by approximately 30 percent but at the end of the period 1984 to 1987 there was a productivity recovery of about 11 percent

mergers and technical efficiency in spanish savings banks a stochastic distance function approach abstract the aim of this paper is to test the temporal variation of technical efficiency of spanish savings banks during the period 1985 1998 furthermore we test whether merged and non merged firms have different levels and temporal patterns of technical efficiency a stochastic output distance function r w shephard theory of cost and production functions princeton university press princeton nj is employed to accommodate multiple output technology the distance function provides the advantage that it does not need information about prices so it can accommodate the multi product nature of the financial sector only using the quantities as data an important point when the assumptions about perfectly competitive markets are unlikely to be met the temporal variation of efficiency is modeled extending the battese and coelli journal of productivity analysis 3 1992 153 169 approach in two ways relaxing the monotonicity of the temporal variation pattern of the efficiency term and allowing for different patterns of efficiency change between merged and non merged firms

cost efficiency in bangladesh banking does financial reform matter abstractthis article estimates the cost efficiency of the commercial banks of bangladesh in the context of financial reform employing the single stage stochastic frontier analysis sfa model the study uses a unique balanced panel data set comprising bank level annual data from the dominant commercial banks in bangladesh for the period 1983 2012 the results show that bank cost has fallen due to financial deregulation our results from the data envelopment analysis do not vary significantly that we obtained from the sfa in addition the presence of politically linked directors on the bank board has an adverse effect on efficiency these findings suggest that further reforms aiming at removing all sorts of political influence should continue to ensure competitive environment in order to achieve cost efficiency in the financial sector of the country

banking efficiency in the nordic countries abstract evidence of the relative competitiveness of the banking industries in three nordic countries is provided by applying data envelopment analysis of productivity on the national and the pooled data sets the analysis produces a detailed account of how well banks from different countries and different sizes may be prepared to meet the more intense competition of a common european banking market

the effects of operating and capital subsidies on total factor productivity a decomposition approach past studies relied on ad hoc associations to establish relationships between productivity on one hand and operating and capital subsidies on the other this article deviates from these studies it builds on recent research based on private cost to derive a total factor productivity formula that includes subsidy effects it specifies an empirical model to estimate the required parameters to apply the formula the application to urban transit systems shows that the effects of these subsidies on productivity through technical change reinforce the decline in productivity sakano obeng and azam 1997 applied the stochastic frontier method to public transit data and decomposed allocative inefficiency between internal factors and subsidies they found that the internal factors contributed more toward allocative inefficiencies and subsidies accounted for less than 25 of the technical inefficiencies in transit firms these authors also found operating subsidies to be the major sources of the inefficiencies and that capital subsidies mostly acted as a counterbalancing factor in reducing the inefficiencies these findings suggest that both subsidies play opposing roles in affecting performance and inefficiency and that while capital subsidies increase partial productivity measures operating subsidies may reduce them these effects of subsidies on partial productivity will also affect total factor productivity tfp therefore there is a link between operating and capital subsidies and tfp and we must find a way to decompose the changes in tfp such that we can identify the effects of subsidies this decomposition is the motivation for this article we develop a decomposition method for tfp that permits the contributions of subsidies to be isolated and apply the method to public transit data the article therefore makes contributions in both methodology and application the basis of the decomposition is an extension of the methods discussed in obeng 1994 obeng and azam 1997 and sakano obeng and azam 1997 to derive a tfp measure that depends on subsidies these methods hold that firms maximize output subject to a net cost constraint where net cost is total cost less operating and capital subsidies the dual of this constrained output maximization is that firms minimize their private cost subject to a production function constraint this objective is different from those frequently adopted in the public transit

evaluating the cost efficiency of the italian banking system what can be learned from the joint application of parametric and non parametric techniques abstract research on bank efficiency has developed in two separate streams econometric studies and data envelopment analysis a linear programming technique these two branches of literature have developed quickly but separately in this paper these two approaches have been tested on a common panel of 270 italian banks and this has suggested the following i econometric and linear programming results do not differ dramatically when based on the same data and conceptual framework ii when differences arise they can be explained by going back to the intrinsic features of the models moreover some findings on italian banks may be of interest also to the international reader i efficiency scores show a high variance ii the banking system is split in two between northern and southern banks iii there is a direct rather than inverse relationship between productive efficiency and asset quality iv the efficiency of italian banks did not increase over the period 1988 1992

the static and dynamic environmental efficiency of renewable energy a malmquist index analysis of oecd countries abstract in recent years renewable energy and environmental efficiency have been interesting issues for both academics and industry actors when discussing sustainable development against this background the present study examines the environmental efficiency of renewable energy from the static and the dynamic perspective in 31 oecd countries a study conducted to understand the impact of renewable energy across countries as a non parametric methodology data envelopment analysis is used to measure environmental efficiency through multiple inputs and outputs labor capital and renewable energy supply are the three inputs while gdp is the desirable output and carbon emissions are the undesirable output to measure the dynamic environmental efficiency of renewable energy the malmquist productivity index is applied to estimate the average efficiency change from 2004 to 2011 the results demonstrate geographical differences in environmental efficiency across the oecd countries in oecd america have the highest average environmental efficiency and those in oecd europe have the largest standard deviation we also find that dynamic efficiency is influenced by the global financial crisis triggered in the united states further we show that oecd countries implement both catch up and frontier shift strategies to improve environmental efficiency

biased technical change and the malmquist productivity index the malmquist productivity index has many attractive features one is that it can be epxressed as the product of a technical efficiency change index and a technical change index in this paper we express the technical change index as the product of a magnitude index and a bias index we then express the bias index as the product of an output bias index and an input bias index and we state conditions under which each bias index makes no contribution to productivity change

rationality of energy efficiency improvement targets under the pat scheme in india a case of thermal power plants abstract the market based perform achieve and trade scheme was introduced in india to enhance the energy efficiency of energy intensive sectors and for thermal power plants by reducing their specific energy consumption within the framework of a tradable certificate scheme international experience suggests that effectiveness of such schemes is greatly influenced by the assigned targets of the obligated units setting rational targets is thus a key aspect of successful implementation of the scheme in the present study we examine the rationality of the targets set for the power sector of india based on comparing it with energy saving potential of the plants and the targets assigned to the respective plants data envelopment analysis models are used to determine relative efficiency and energy saving potential the study results indicate that in most cases i the targets are much less than the actual potentials of the thermal power sector ii there exist substantial inefficiencies within the system in both energy use and managerial dexterity and iii if the sector realizes its full potential then the energy saving certificate market may witness a surplus of 4 7 million certificates on account of thermal power sector alone

technical progress inefficiency and productivity change in u s banking 1984 1993 studies often find that on average u s commercial banks are quite inefficient and the authors find that banks became more technically inefficient between 1984 and 1993 from a new decomposition of the malmquist productivity index into changes in pure technical and scale efficiency as well as both pure technical changes and changes in scale of technology they find that much of the inefficiency increase can be attributed to the general failure of banks to adopt technological improvements made by a few banks that advanced the efficient frontier small banks experienced especially large decreases in both efficiency and productivity

assessing eco efficiency through the dea analysis and decoupling index in the latin america countries abstract this study was developed according to a two step approach in the first step we provide an investigation of the changes in eco efficiency under constant and variable return to scale while on a second step the evaluation of the decoupling elasticity will be given the impacts of energy economic and environmental determinants inputs on the performance indicators of eco efficiency were calculated as the inverse of the carbon intensity ratio of the gdp over the co2 emissions both from the world development indicators database the changes in eco efficiency and the decoupling elasticity between co2 emissions and economic growth changes data was used for 16 latin america countries according to five year periods from 1994 to 2013 for all the five time span considered it is worth noting that the degree of technical efficiency for the latin america countries is lower than the degree of technological efficiency thus indicating that a portion of the overall inefficiency is due to the fact that these countries are producing below the production frontier rather than to an inefficient use of technology on average the results have confirmed that the technological scale change in energy production is the dominant factor influencing the optimal production frontier in the sample of countries under analysis complementarily according to the mixed results from the decoupling analysis we may conclude that the increase decrease of the co2 per capita emissions was due to other economic and environmental factors rather than to a negative positive effect of the gdp growth rate

is there a single frontier in a single european banking market abstract this paper attempts to estimate comparable efficiency scores for european banks operating in the single market in the eu using a data set of more than 5000 large commercial banks from all major european banking markets over the period 1993 2004 the application of meta frontiers enables us to assess the existence of a single and integrated european banking market we find evidence in favor of a single european banking market characterized by cost and profit meta frontiers however compared to the meta frontier estimations pooled frontier estimations tend to underestimate efficiency levels and correlate poorly with country specific frontier efficiency ranks

explaining efficiency differences among large german and austrian banks cost efficiency scale efficiency and productivity change are estimated by data envelopment analysis and cost efficiency is regressed on explanatory variables no evidence is found for average productivity responding to deregulation over the period studied state owned banks are found to be more cost efficient likely owing to cheaper funds and cooperative banks to be about as cost efficient as private banks increasing economies of scale but decreasing economies of scope provide rationale for m as among banks with similar product portfolios interbank and capital market funding is found to be more cost efficient than deposits when the cost of retail networks is controlled

the malmquist total factor productivity index the definitions of the malmquist output and input quantity indexes specified by d w caves l r christensen and w e diewert 1982 are applied in this study based on these indexes a malmquist total factor productivity index is derived for general production structures the definition maintains the fundamental characteristic of a productivity index as a ratio between an output quantity change index and an input quantity change index this index provides a remedy for the shortcoming of the traditional definition of the malmquist productivity index in that the latter does not correctly measure changes in productivity in the presence of changes in returns to scale copyright 1996 by the editors of the scandinavian journal of economics

a nonparametric approach for assessing productivity dynamics of large u s banks the 1980s marked an era of substantial change for the us commercial banking industry an issue of considerable interest to banking analysts and economists alike is whether the intensified competitive pressure generated by deregulation and notable financial innovations enhanced productivity to investigate the response to these changes the non parametric malmquist index is used to evaluate productivity dynamics a statistically significant productivity surge found between 1983 and 1984 is followed by productivity regress the next period post 1985 sustained productivity progress is observed for the remainder of the decade productivity movements are primarily attributable to technological changes rather than scale changes or convergence to the production frontier

the effects of deregulation on the performance of financial institutions the case of spanish savings banks this paper examines the impact of regulatory reform on the performance of spanish savings banks the focus is whether increased competition brought on by deregulation affected performance of banks over time output technical efficiency which is defined in terms of the production possibility frontier is also examined empirical results show declining levels of output technical efficiency along with a significantly high rate of technical progress in spite of declining technical efficiency during this period evidence of an increasing trend in productivity growth is found

a note on banking efficiency in portugal new vs old banks following entry into the european community in 1986 portugal transformed rapidly its repressed banking system with deregulation the opening of borders the granting of new banking licenses and privatization in a more competitive banking system one would expect a priori an increase in operational efficiency this paper attempts to quantify the magnitude of efficiency gains over the years 1990 1995 moreover the paper documents the relative efficiency performance of new domestic banks not hampered by a legacy of inefficiency from the past they could operate nearer the efficiency frontier the case of portugal provides unique information on the joint effect of deregulation and the granting of new banking licenses on the change in operational efficiency of a previously repressed banking system

rivalry between strategic alliances abstract rivalry between strategic alliances is investigated in a model where each alliance member maximizes its own profit and some share of its partner s profit a complementary alliance confers a strategic advantage by allowing the partners to credibly commit to greater output owing to both within alliance complementarities and cross alliance substitutabilities although rivalry between different alliances can sometimes lead to a prisoners dilemma for firms it tends to improve economic welfare on the other hand an alliance that arises due purely to the threat of entry may reduce welfare

regional analysis across colombian departments a non parametric study of energy use abstract the analysis of energy use is important in emerging economies and especially in the manufacturing industries as energy is a key factor of sustainable development this research analyses and evaluates the features of regional energy use and efficiency across colombian departments in the manufacturing industries for the period between 2005 and 2013 by applying two malmquist data envelopment analysis models the results indicate significant difference in energy use and efficiency across colombian departments in the manufacturing industries the results of the malmquist indexes determine that various manufacturing industries across colombian departments have a high potential to increase energy efficiency several manufacturing industries across colombian departments have experienced gains in productivity a growth in efficiency an improvement in the relationship between inputs and outputs and scale production and advances in innovation through new technologies this technique allows to make comparisons and improves energy policies to increase energy efficiency and decrease co 2 emissions the application of panel data models indicate that increases in energy prices exports and productivity lead to better energy use while a higher presence of energy intensive sectors and small and medium enterprises across colombian departments reduce energy efficiency the methods selected in this research generated consistent robust and reliable estimates related to energy use and co 2 emissions for regional studies the findings of this study indicate that diverse energy policies should implement in the industrial sector across colombian departments and that they should contribute to improvements in energy use especially in small and medium companies and energy intensive sectors

robust nonparametric quantile estimation of efficiency and productivity change in u s commercial banking 1985 2004 this article uses a new nonparametric unconditional hyperbolic order quantile estimator to construct a hyperbolic version of the malmquist index unlike traditional nonparametric efficiency estimators the new estimator is both robust to data outliers and has a root n convergence rate we use this estimator to examine changes in the efficiency and productivity of u s banks between 1985 and 2004 we find that larger banks experienced larger efficiency and productivity gains than small banks consistent with the presumption that recent changes in regulation and information technology have favored larger banks

malmquist type indices in the presence of negative data an application to bank branches in this paper we develop an index and an indicator of productivity change that can be used with negative data for that purpose the range directional model rdm a particular case of the directional distance function is used for computing efficiency in the presence of negative data we use rdm efficiency measures to arrive at a malmquist type index which can reflect productivity change and we use rdm inefficiency measures to arrive at a luenberger productivity indicator and relate the two the productivity index and indicator are developed relative to a fixed meta technology and so they are referred to as a meta malmquist index and meta luenberger indicator we also address the fact that vrs technologies are used for computing the productivity index and indicator a requirement under negative data which raises issues relating to the interpretability of the index we illustrate how the meta malmquist index can be used not only for comparing the performance of a unit in two time periods but also for comparing the performance of two different units at the same or different time periods the proposed approach is then applied to a sample of bank branches where negative data were involved the paper shows how the approach yields information from a variety of perspectives on performance which management can use

export diversification what s behind the hump hy should export diversification be taken as a policy objective per se there are two reasons that it should not first according to ricardo countries should specialize not diversify second the heckscher ohlin model implies that export patterns are largely determined by endowments so if anything we should worry about factor accumulation not diversification yet export diversification is a constant preoccupation of policymakers in developing countries as de ferranti et al 2002 note a recurrent preoccupation of latin american policymakers is that their natural riches produce a highly concentrated structure of export revenues which then leads to economic volatility and lower growth p 38 the notion that export patterns are fully determined by endowments is of course naive the relationship of endowments trade and growth is a complex and imperfectly understood one intra industry trade models showed long ago that many factors other than endowments including market failures and policies can affect trade patterns more recently hausmann hwang and rodrik 2007 argued that export patterns can display path dependence in the presence of externalities

pesticide use environmental spillovers and efficiency a dea risk adjusted efficiency approach applied to dutch arable farming pesticides are widely used by crop producers in developed countries to combat risk associated with pests and diseases however their indiscriminate use can lead to various environmental spillovers that may alter the agricultural production environment thus contributing to production risk this study utilises a data envelopment analysis dea approach to measure performance of arable farms incorporating pesticides environmental spillovers and output variance as undesirable outputs in the efficiency analysis and taking explicitly into account the effect of pesticides and other inputs on production risk the application focuses on panel data from dutch arable farms over the period 2003 2007 a moment approach is used to compute output variance providing empirical representations of the risk increasing or decreasing nature of the used inputs finally shadow values of risk adjusted inputs are computed we find that pesticides are overused in dutch arable farming and there is a considerable evidence of the need for decreasing pesticides environmental spillovers

trade policy trade costs and developing country trade this paper briefly reviews new indices of trade restrictiveness and trade facilitation that have been developed at the world bank the paper also compares the trade impact of different types of trade restrictions applied at the border with the effects of domestic policies that affect trade costs based on a gravity regression framework the analysis suggests that tariffs and non tariff measures continue to be a significant source of trade restrictiveness for low income countries despite preferential access programs this is because the value of trade preferences is quite limited a new measure of the relative preference margin developed in the paper reveals that this is very low for most country pairs most countries with very good duty free access to a market generally have competitors that have the same degree of access the empirical analysis suggests that measures to improve logistics performance and facilitate trade are likely to have the greatest positive effects in expanding developing country trade increasing the trade impacts of lowering remaining border barriers by a factor of two or more

trends in efficiency in response to regulatory reforms the case of indian and pakistani commercial banks this paper attempts to estimate trends in the efficiency levels of indian and pakistani commercial banks between 1985 and 2003 a time period which encompasses two phases of significant change to the regulation of the financial sector in both countries our efficiency estimates show that during the initial years of the post reform period a reduction in efficiency is observed for banks in both countries however efficiency levels were found to have increased subsequently suggesting a period of initial adjustment throughout much of the 1990s followed by a subsequent correction in the latter part of the sample period

the direct and relative effects of preferential market access abstract the proliferation of preferential trade agreements has resulted in a complex system of preferences in which market access conditions are often discriminatory in this paper we investigate how market access conditions have evolved between 2000 and 2009 and how this has affected international trade our results show that the proliferation of preferential access has increased bilateral trade not only due to lower tariffs but also because preferential access often resulted in higher preferential margins vis a vis foreign competitors the results also indicate that the evolution of the system of preferences has been disadvantageous for countries that did not actively engage in forming new trade agreements

energy regulation in china objective selection potential assessment and responsibility sharing by partial frontier analysis to cope with the excessive growth of energy consumption the chinese government has been trying to strengthen the energy regulation system by introducing new initiatives that aim at controlling the total amount of energy consumption a partial frontier analysis is performed in this paper to make a comparative assessment of the combinations of possible energy conservation objectives new constraints and regulation strategies according to the characteristics of the coordination of existing regulation structure and the optimality of regulation strategy four scenarios are constructed and regional responsibilities are reasonably divided by fully considering the production technology in the economy the relative importance of output objectives and the total amount controlling is compared and the impacts on the regional economy caused by the changes of regulation strategy are also evaluated for updating regulation policy

experience as a barrier to contestability in airline markets contrary to one of the predictions of the contestability hypothesis price in deregulated u s passenger airline markets is related to actual competition from diversifying former intrastates and newly established carriers more important former intrastates have a larger impact on price than do newly established firms a result consistent with these markets being imperfectly competitive because of an industry experience barrier to entry unlike actual competition a measure of potential competition has no effect in constraining price copyright 1989 by mit press

evaluating the performance of us credit unions credit unions are small cooperative not for profit institutions which distinguishes them from other financial intermediaries in this study we conduct a performance evaluation of credit unions the criteria respect the unique organizational and institutional features of credit unions without losing sight of the fact that they must compete with other financial intermediaries we use nonparametric nonstochastic techniques to measure performance and we use parametric stochastic techniques to attribute performance variation to features of credit unions and their operating environment our sample consists of two thirds of all active credit unions in 1990