Efficiency, scale and scope economies in the Ukrainian banking sector in 1998
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Date
2001
Authors
Mertens, Alexander
Urga, Giovanni
Journal Title
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Abstract
This paper evaluates the current development of the Ukrainian banking system. The research was concentrated on the evaluation of cost and profit efficiency and scale and scope economies for 79 from 168 Ukrainian commercial banks in 1998. There is evidence that small banks operate more efficiently in cost terms but are less efficient in profit terms and furthermore, there is a substantial difference in scale economies between small and large banks. Large banks show significant diseconomies of scale while small ones show significant scale economies. This result could suggest that current technology in the financial sector does not allow efficient growth and concentration of the financial sector in Ukraine.
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Keywords
Ukrainian banking sector, x-inefficiencies, economies of scale and scope, cost functions
Citation
Mertens A. Efficiency, scale and scope economies in the Ukrainian banking sector in 1998 / Alexander Mertens, Giovanni Urga // Emerging Markets Review. - 2001. - Vol. 2. - Is. 3. - P. 292-308.