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Trends in New Zealand Bank Efficiency over Time

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  • Tripe, David

Abstract

This paper explores the extent of efficiency improvements achieved by New Zealand banks over the period 1996 to 2002, using data envelopment analysis (DEA), on a time-series, rather than cross-sectional basis. Evidence is found for improvements in bank efficiency through time, some of which can be attributed to falls in the general level of interest rates, although a further portion may be due to either management effort to improve bank efficiency or technical progress. Because some of the results obtained appear to be a consequence of the methodology, rather than necessarily being consistent with other interpretations of the data, the paper also provides insights into complications that can arise with use of DEA.

Suggested Citation

  • Tripe, David, 2003. "Trends in New Zealand Bank Efficiency over Time," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 3(1).
    • Handle: RePEc:eaa:aeinde:v:3:y:2003:i:3_3
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    References listed on IDEAS

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    1. Greg Walker, 1998. "Economies of Scale in Australian Banks 1978–1990," Australian Economic Papers, Wiley Blackwell, vol. 37(1), pages 71-87, March.
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    3. repec:bla:ecorec:v:72:y:1996:i:218:p:246-59 is not listed on IDEAS
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    6. Alam, Ila M Semenick, 2001. "A Nonparametric Approach for Assessing Productivity Dynamics of Large U.S. Banks," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 33(1), pages 121-139, February.
    7. Berger, Allen N. & Humphrey, David B., 1997. "Efficiency of financial institutions: International survey and directions for future research," European Journal of Operational Research, Elsevier, vol. 98(2), pages 175-212, April.
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    10. Sathye, Milind, 2001. "X-efficiency in Australian banking: An empirical investigation," Journal of Banking & Finance, Elsevier, vol. 25(3), pages 613-630, March.
    11. Garden, Kaylee A. & Ralston, Deborah E., 1999. "The x-efficiency and allocative efficiency effects of credit union mergers," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 9(3), pages 285-301, August.
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    Cited by:

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    3. Avkiran, Necmi K., 2009. "Removing the impact of environment with units-invariant efficient frontier analysis: An illustrative case study with intertemporal panel data," Omega, Elsevier, vol. 37(3), pages 535-544, June.
    4. Abayomi Oredegbe, 2021. "Cost Efficiency Determinants: Evidence from the Canadian Banking Industry," International Journal of Business and Management, Canadian Center of Science and Education, vol. 15(1), pages 1-86, July.

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    More about this item

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • G2 - Financial Economics - - Financial Institutions and Services

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