The operating efficiency of financial holding and nonfinancial holding banks—Epsilou‐based measure metafrontier data envelopment analysis model

Ying Li, Yung-Ho Chiu, Hongyi Cen and Tai‐Yu Lin

Managerial and Decision Economics, 2019, vol. 40, issue 5, 488-499

Abstract: Previous bank efficiency studies assumed that the same efficient frontier system exists in different types of banks, but the conventional radial data envelopment analysis (DEA) model slacks are not counted in efficiency scores, and nonradial DEA models do not consider radial features. This paper develops an Epsilou‐based measure meta‐DEA approach for measuring the efficiencies and technology gaps of different bank types. The results are as the follows: The average efficiency and technology gaps of nonfinancial holding banks are better than those of financial holding banks. The nonfinancial holding banks are more efficient than financial holding banks in investment and other income.

Date: 2019
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https://doi.org/10.1002/mde.3018

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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:40:y:2019:i:5:p:488-499

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