Impact of policy changes on the efficiency and returns-to-scale of Japanese financial institutions: An evaluation

A.S.M. Azad, Yasushi Suzuki, Victor Fang and Amirul Ahsan

Research in International Business and Finance, 2014, vol. 32, issue C, 159-171

Abstract: This paper examines the impact of FSA's (Financial Services Agency) recent policy changes on the efficiency and returns-to-scale (RTS) of Japanese financial institutions including banks, securities companies and bank holding companies. Three kinds of efficiency are investigated namely, technical efficiency (TE), pure technical efficiency (PTE) and scale efficiency (SE) using the non-parametric methodology named data envelopment analysis (DEA). The DEA analysis shows a substantial improvement in the overall efficiency of Japanese banks, albeit a significant difference of efficiency scores between the major/city banks and the regional banks. Results are robust to alternative specifications of efficiency and scale changes.

Keywords: Policy changes; DEA; Efficiency; Returns-to-scale; Malmquist index (search for similar items in EconPapers)
JEL-codes: C G (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:32:y:2014:i:c:p:159-171

DOI: 10.1016/j.ribaf.2014.05.001

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