Is bank competition detrimental to efficiency? Evidence from China
Zuzana Fungáčová (),
Pierre Pessarossi and
Laurent Weill ()
China Economic Review, 2013, vol. 27, issue C, 121-134
This paper addresses the relationship between bank competition and efficiency by computing Lerner indices and cost efficiency scores for a sample of Chinese banks over the period 2002–2011. Granger-causality tests are performed in a dynamic GMM panel estimator framework to evaluate the sign and direction of causality between them. We observe no increase in bank competition over the period, even as cost efficiency improves. In a departure from the empirical literature showing that competition negatively Granger-causes cost efficiency for Western banks, we find no significant relation between competition and efficiency. This suggests that measures to increase bank competition in the Chinese context are not detrimental to efficiency.
Keywords: Bank; Competition; Efficiency; China (search for similar items in EconPapers)
JEL-codes: G21 D40 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (30) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
Working Paper: Is bank competition detrimental to efficiency?: Evidence from China (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:27:y:2013:i:c:p:121-134
Access Statistics for this article
China Economic Review is currently edited by B.M. Fleisher, K. X. D. Huang, M.E. Lovely, Y. Wen, X. Zhang and X. Zhu
More articles in China Economic Review from Elsevier
Bibliographic data for series maintained by Nithya Sathishkumar ().