Does Competition Foster Efficiency? Empirical Evidence from Malaysian Commercial Banks

Rossazana Ab Rahim ()
Additional contact information
Rossazana Ab Rahim: Faculty of Economics and Business, Universiti Malaysia Sarawak, 94300 Kota Samarahan, Sarawak

Asian Academy of Management Journal of Accounting and Finance (AAMJAF), 2016, vol. 12, issue 1, 1-23

Abstract: This study focuses on technical efficiency measures and its decompositions as well as the relationship between efficiency and banking competition of Malaysian commercial banks. This study employs Data Envelopment Analysis to assess efficiency performance of Malaysian commercial banks during 1996–2011 while to estimate banking competition; Lerner index approach is utilised. Next, Granger causality tests between competition indexes and various measures of efficiency are undertaken to investigate "Does competition foster efficiency?" The evidence suggests that Malaysian commercial banks experienced increased concentration coupled with lower competition. The results of causality tests support a positive effect of competition on technical efficiency in Malaysian banking.

Keywords: super-efficiency; foreign banks; domestic banks; Malaysian banking (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://web.usm.my/journal/aamjaf/vol%2012-1-2016/aamjaf120116_01.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:usm:journl:aamjaf01201_1-23

Access Statistics for this article

More articles in Asian Academy of Management Journal of Accounting and Finance (AAMJAF) from Penerbit Universiti Sains Malaysia Contact information at EDIRC.
Bibliographic data for series maintained by Journal Division, Penerbit Universiti Sains Malaysia ().