Abstract: Over the past several years, substantial research effort has gone
into measuring the efficiency of financial
institutions. Many studies have found that inefficiencies are
quite large, on the order of 20 percent or more of
total banking industry costs and about half of the industry's
potential profits. There is no consensus on the
sources of the differences in measured efficiency. This paper
examines several possible sources, including
differences in efficiency concept, measurement method, and a
number of bank, market, and regulatory
characteristics. We review the extant literature and provide new
evidence using data on U.S. banks over the
period 1990-95.
Keywords: Bank, efficiency, cost, profit
Full paper (3060 KB PDF)
Home | Economic research and data | FR working papers | FEDS | 1997 FEDS papers
Accessibility
To comment on this site, please fill out our feedback form.
Last update: July 16, 1997
|