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Estimation of the efficiency of Tunisian bank branches using a stochastic frontier approach

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  • Dorsaf Ben Aissia

    (Isace)

  • Molka Ellouz

    (Isace)

Abstract

This article examines the efficiency scores of 94 Tunisian bank branches opening under the same public bank. It estimates the efficiency scores assigned to each bank branch using a model of the parametric method, namely the stochastic frontier approach (SFA). This method allows to isolate the term of random error, which reflects the inefficiency of each bank branch. Using data over the period 2007–2019, the paper shows that the branches of our sample present relatively similar levels of efficiency. It also identifies that the branches with the highest efficiency scores are those of the Northeast governorates.

Suggested Citation

  • Dorsaf Ben Aissia & Molka Ellouz, 2021. "Estimation of the efficiency of Tunisian bank branches using a stochastic frontier approach," SN Business & Economics, Springer, vol. 1(10), pages 1-19, October.
    • Handle: RePEc:spr:snbeco:v:1:y:2021:i:10:d:10.1007_s43546-021-00133-x
    DOI: 10.1007/s43546-021-00133-x
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