ISSN:
1573-0441
Keywords:
Banking
;
Translog Cost Function
;
Economies of Scale
;
Economies of Scope
;
Inefficiency
Source:
Springer Online Journal Archives 1860-2000
Topics:
Economics
Notes:
Abstract Using 1992 data of 1490 banks covering about 40% of German banking, we specify a multi-product translog cost function and follow the “thick frontier”-approach to control for cost inefficiency when evaluating the technology of banking. Scale economies are found to exist up to a size of about 5 billion DM of total assets, with diseconomies being caused by non-operating costs. There is hardly any evidence of economies of scope. Compared to cost inefficiency external factors play a surprisingly strong role in explaining cost differences between high-cost and low-cost banks. Smaller banks turn out to be more responsive to input prices.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1023/A:1018346332447
Permalink
