Efficiency Convergence Properties of Indonesian Banks 1992-2007

Tiantian Zhang () and Kent Matthews
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Tiantian Zhang: Cardiff Business School

No E2011/12, Cardiff Economics Working Papers from Cardiff University, Cardiff Business School, Economics Section

Abstract: This paper examines the convergence properties of cost efficiency for Indonesian banks for the period 1992-2007. It employs the Simar and Wilson's (2007) two stage semi-parametric double bootstrap DEA procedure to estimate cost efficiency. Using panel data estimation, the paper examines -convergence and &sigma,-convergence, to test the speed at which Indonesian banks are converging, towards the best practice and country average. We find evidence that in general the post-crisis structural reform process improved the average level of efficiency and improved the distribution of efficiency across banks significantly. The Asian financial crisis and the structural reform had the effect of slowing the adjustment speed of bank efficiency.

Keywords: Banks; Efficiency; Indonesia; Convergence (search for similar items in EconPapers)
JEL-codes: G21 G28 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2011-04
New Economics Papers: this item is included in nep-ban, nep-cba, nep-cse and nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Efficiency convergence properties of Indonesian banks 1992--2007 (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:cdf:wpaper:2011/12

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