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An Efficiency Comparison of European Banking Systems Operating under Different Environmental Conditions

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Abstract

The paper investigates the operating efficiency differences of a sample of commercial banks across 10 European countries. First, the paper analyzes the technical efficiency of each country sample following the “basic” Data Envelopment Analysis (DEA) model incorporating only banking variables. Then, a “complete” DEA model is introduced, incorporating environmental factors together with the banking variables of the basic model. The comparison between the two models shows that country-specific environmental conditions exercise a strong influence over the behavior of each country's banking industry.

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Authors and Affiliations

  1. Departamento de Teoría Económica, Facultad CC.EE., Universidad de Málaga, Plza. El Ejido s/n, 29013, Málaga, Spain

    Ana Lozano-Vivas

  2. Departamento de Estadística y Matemática Aplicada, Universidad Miguel Hernández, Elche, Spain

    Jesús T. Pastor

  3. Departament d'Anàlisi Econòmica, Facultad d'Economia. Campus dels Tarongers, Avda. dels, Tarongers, s/n. Edifici Departamental Oriental, 46022, Valencia, España

    José M. Pastor

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  1. Ana Lozano-Vivas
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  2. Jesús T. Pastor
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  3. José M. Pastor
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Lozano-Vivas, A., Pastor, J.T. & Pastor, J.M. An Efficiency Comparison of European Banking Systems Operating under Different Environmental Conditions. Journal of Productivity Analysis 18, 59–77 (2002). https://doi.org/10.1023/A:1015704510270

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