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Rising productivity of Australian trading banks under deregulation 1986–1995

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  • Necmi Avkiran

Abstract

Productivity of four major trading banks and six regional banks is investigated using Malmquist productivity indices in the deregulated period 1986–1995. The principal findings indicate an overall rise in total productivity driven more by technological progress than technical efficiency. Performance of major trading banks on technical efficiency is similar to that of regional banks but higher on technological progress. Distinguishing between improvement in technical efficiency and technological change is significant for policy formulation. Technological innovation can be construed as a sign of dynamic efficiency where banks take advantage of new cost-effective technologies and pursue product and market development. Copyright Springer 2000

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  • Necmi Avkiran, 2000. "Rising productivity of Australian trading banks under deregulation 1986–1995," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 24(2), pages 122-140, June.
    • Handle: RePEc:spr:jecfin:v:24:y:2000:i:2:p:122-140
    DOI: 10.1007/BF02752708
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    Cited by:

    1. Avkiran, Necmi K., 2011. "Association of DEA super-efficiency estimates with financial ratios: Investigating the case for Chinese banks," Omega, Elsevier, vol. 39(3), pages 323-334, June.
    2. Avkiran, Necmi K., 2009. "Opening the black box of efficiency analysis: An illustration with UAE banks," Omega, Elsevier, vol. 37(4), pages 930-941, August.
    3. Soumi Majumder & Debasish Biswas, 2022. "COVID-19: impact on quality of work life in real estate sector," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(2), pages 413-427, April.
    4. Casu, Barbara & Ferrari, Alessandra & Girardone, Claudia & Wilson, John O.S., 2016. "Integration, productivity and technological spillovers: Evidence for eurozone banking industries," European Journal of Operational Research, Elsevier, vol. 255(3), pages 971-983.
    5. Sturm, Jan-Egbert & Williams, Barry, 2010. "What determines differences in foreign bank efficiency? Australian evidence," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 20(3), pages 284-309, July.
    6. Sepideh Kaffash & Reza Kazemi Matin & Mohammad Tajik, 2018. "A directional semi-oriented radial DEA measure: an application on financial stability and the efficiency of banks," Annals of Operations Research, Springer, vol. 264(1), pages 213-234, May.
    7. Amir Moradi-Motlagh & Ali Salman Saleh, 2014. "Re-Examining the Technical Efficiency of Australian Banks: A Bootstrap DEA Approach," Australian Economic Papers, Wiley Blackwell, vol. 53(1-2), pages 112-128, June.
    8. Sunil Kumar, 2013. "Banking reforms and the evolution of cost efficiency in Indian public sector banks," Economic Change and Restructuring, Springer, vol. 46(2), pages 143-182, May.
    9. Sturm, Jan-Egbert & Williams, Barry, 2008. "Characteristics determining the efficiency of foreign banks in Australia," Journal of Banking & Finance, Elsevier, vol. 32(11), pages 2346-2360, November.
    10. Moffat, Boitnmelo & Valadkhani, Abbas, 2008. "Technical efficiency in Botswana’s financial institutions: a DEA approach," Economics Working Papers wp08-14, School of Economics, University of Wollongong, NSW, Australia.
    11. Sturm, Jan-Egbert & Williams, Barry, 2004. "Foreign bank entry, deregulation and bank efficiency: Lessons from the Australian experience," Journal of Banking & Finance, Elsevier, vol. 28(7), pages 1775-1799, July.
    12. C Murillo-Melchor & J M Pastor & E Tortosa-Ausina, 2010. "A bootstrap approach to analyse productivity growth in European banking," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 61(12), pages 1729-1745, December.
    13. Joshua Kirkwood & Daehoon Nahm, 2006. "Australian Banking Efficiency and Its Relation to Stock Returns," The Economic Record, The Economic Society of Australia, vol. 82(258), pages 253-267, September.
    14. Moradi-Motlagh, Amir & Jubb, Christine, 2020. "Examining irresponsible lending using non-radial inefficiency measures: Evidence from Australian banks," Economic Analysis and Policy, Elsevier, vol. 66(C), pages 96-108.
    15. 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.
    16. Thierno Amadou Barry & Santos José O. Dacanay & Laetitia Lepetit & Amine Tarazi, 2008. "Ownership Structure and Bank Efficiency in the asia pacific region," Working Papers hal-00915134, HAL.
    17. 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).
    18. Mustabshira Rushdi & Judith Tennant, 2003. "Profitability of Australian Banks: 1985-2001," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 10(3), pages 229-243.
    19. Necmi Kemal Avkiran, 2017. "An illustration of multiple-stakeholder perspective using a survey across Australia, China and Japan," Annals of Operations Research, Springer, vol. 248(1), pages 93-121, January.
    20. Hazera Akter & Suborna Barua, 2016. "International trade financing: a comparative study on the performance of state-owned and private commercial banks of Bangladesh," International Journal of Monetary Economics and Finance, Inderscience Enterprises Ltd, vol. 9(2), pages 164-186.
    21. Malcolm Abbott & Su Wu & Wei Wang, 2013. "The productivity and performance of Australia’s major banks since deregulation," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 37(1), pages 122-135, January.
    22. Moffat, Boitnmelo & Valadkhani, Abbas & Harvie, Charles, 2008. "Identifying productivity change in Botswana’s financial institutions: an application of Malmquist productivity indices," Economics Working Papers wp08-13, School of Economics, University of Wollongong, NSW, Australia.
    23. Sufian, Fadzlan, 2006. "The Efficiency Of Islamic Banking Industry: A Non-Parametric Analysis With Non-Discretionary Input Variable," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 14, pages 54-87.
    24. Avkiran, Necmi K. & Thoraneenitiyan, Nakhun, 2010. "Purging data before productivity analysis," Journal of Business Research, Elsevier, vol. 63(3), pages 294-302, March.
    25. Awdeh, Ali, 2013. "Impact of financial deregulation on bank productivity: Evidence from a panel of Arab banks," MPRA Paper 119124, University Library of Munich, Germany.

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