The effects of governance changes on bank efficiency in China: a stochastic distance function approach

Jiang, Chunxia and Yao, Shujie and Zhang, Zongyi (2009) The effects of governance changes on bank efficiency in China: a stochastic distance function approach. China Economic Review, 20 (4). pp. 717-731. ISSN 1043-951X

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Abstract

China has accelerated banking reform since joining the Word Trade Organisation (WTO) in 2001. Employing a stochastic distance function approach, this paper examines bank technical efficiency and differentiates the static, selection and dynamic governance effects on bank efficiency for the 11-year period 1995–2005. The results show that bank efficiency has improved. Joint-stock ownership is associated with better performance in terms of profitability than state ownership (static effect). Strong selection effects are found for both foreign acquisition and going public reform strategies. Foreign acquisition may benefit domestic banks by efficiency gains in the long run, but privatization via initial public offerings (IPOs) appears to have only some short-term effects.

Item Type: Article
Research Areas: A. > Business School > Economics
Item ID: 10732
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Depositing User: Chunxia Jiang
Date Deposited: 03 Jun 2013 07:10
Last Modified: 13 Oct 2016 14:27
URI: http://eprints.mdx.ac.uk/id/eprint/10732

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