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Efficiency, Bond of Association and Exit Patterns in Credit Unions: Australian Evidence
Author(s) -
Brown Rayna,
Brown Rob,
O'Connor Ian
Publication year - 1999
Publication title -
annals of public and cooperative economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.526
H-Index - 37
eISSN - 1467-8292
pISSN - 1370-4788
DOI - 10.1111/1467-8292.00097
Subject(s) - bond , credit union , data envelopment analysis , association (psychology) , economics , bond market , frontier , proposition , business , demographic economics , monetary economics , finance , statistics , political science , psychology , philosophy , mathematics , epistemology , psychotherapist , law
Data envelopment analysis is used in this study to provide measures of the efficiency of individual credit unions in the Australian state of Victoria in the period 1992–5. The resulting measures are consistent with those reported in comparable studies. There is no evidence that over the period of the study, the ‘average’ credit union moved closer to the efficient frontier. Efficiency measures are analysed according to the bond of association and the results are consistent with the proposition that a tighter bond will tend to reduce operating costs. In the period of the study there were a large number of exits by merger, including exits by small credit unions with high efficiency measures. Possible explanations in terms of the expected benefits to the members of acquiring and exiting credit unions are suggested and evaluated.