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The operating efficiency of financial holding and nonfinancial holding banks—Epsilou‐based measure metafrontier data envelopment analysis model
Author(s) -
Li Ying,
Chiu Yungho,
Cen Hongyi,
Lin TaiYu
Publication year - 2019
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.3018
Subject(s) - data envelopment analysis , measure (data warehouse) , frontier , envelopment , efficient frontier , investment (military) , economics , econometrics , business , finance , computer science , mathematics , statistics , portfolio , archaeology , politics , political science , law , history , database
Previous bank efficiency studies assumed that the same efficient frontier system exists in different types of banks, but the conventional radial data envelopment analysis (DEA) model slacks are not counted in efficiency scores, and nonradial DEA models do not consider radial features. This paper develops an Epsilou‐based measure meta‐DEA approach for measuring the efficiencies and technology gaps of different bank types. The results are as the follows: The average efficiency and technology gaps of nonfinancial holding banks are better than those of financial holding banks. The nonfinancial holding banks are more efficient than financial holding banks in investment and other income.