An Analysis Of The Relevance Of OBS Items In Explaining Productivity Change In European Banking
- Topics:
- Organization
- Source:
- University of Reading
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Overview: The 1990s have witnessed a significant growth in bank income generated through non-traditional activities especially for large EU universal institutions. Using the non-parametric Malmquist methodology this paper analyses the importance of the inclusion of Off-Balance Sheet (OBS) business in the definition of banks output when estimating total factor productivity change indexes. The analysis is then extended to the decomposition of total factor productivity change into technical efficiency and technological change. The results reinforce the prevalent view in the literature, suggesting that the exclusion of OBS items leads to an underestimation of productivity levels. However, the introduction of OBS seems to have impacted the most on technological change rather than efficiency change.
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Format: PDF | Size: 532KB | Date: Nov 2003 | Pages: 24






