Banking efficiency in China: Application of DEA to pre- and post-deregulation eras: 1993–2000

This paper examines the cost, technical and allocative efficiency of 43 Chinese banks over the period 1993 to 2000. The goal of this analysis is to identify the change in Chinese banks' efficiency following the program of deregulation initiated by the government in 1995. Results show that the l...

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Bibliographic Details
Published in:China economic review 2005, Vol.16 (3), p.229-245
Main Authors: CHEN, Xiaogang, SKULLY, Michael, BROWN, Kym
Format: Article
Language:English
Subjects:
Banking
China
Deregulation
Efficiency
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Summary:This paper examines the cost, technical and allocative efficiency of 43 Chinese banks over the period 1993 to 2000. The goal of this analysis is to identify the change in Chinese banks' efficiency following the program of deregulation initiated by the government in 1995. Results show that the large state-owned banks and smaller banks are more efficient than medium sized Chinese banks. In addition, technical efficiency consistently dominates the allocative efficiency of Chinese banks. The financial deregulation of 1995 was found to improve cost efficiency levels including both technical and allocative efficiency.
ISSN:1043-951X
1873-7781
DOI:10.1016/j.chieco.2005.02.001