Nonparametric efficiency and productivity change measurement of banks with corporate social responsibilities : the case for Ghana
Ohene-Asare, Kwaku (2011) Nonparametric efficiency and productivity change measurement of banks with corporate social responsibilities : the case for Ghana. PhD thesis, University of Warwick.
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Official URL: http://webcat.warwick.ac.uk/record=b2583281~S1
This thesis has twofold objectives. The first is to develop a framework based on the existing theory and method of Data Envelopment Analysis (DEA) for measuring performance of financial firms that have the dual goals of profit maximisation and Corporate Social Responsibilities (CSRs). The second is to examine the impact of banking regulatory reforms including bank ownership, specialisation, and capitalisation types on the average efficiency and frontier differences of banking subgroups. The objectives are achieved using the standard DEA, the metafrontier analysis and the global frontier differences (GFD). DEA can handle multidimensional inputs and outputs without specifying specific functional forms. CSR is conceptually justified and modelled as an additional output into the banking intermediation approach. Two DEA models, one with CSR and another without CSR are measured and compared. Parametric and nonparametric tests and regressions are utilised to support, empirically, the relevance of CSR in bank performance evaluation. Do foreign banks outperform private-domestic and state banks? Should banks diversify their products or focus in narrow range of products and services? Are listed banks more efficient than non-listed banks? The second part of the thesis contributes to the extant literature by answering these questions using the metafrontier analysis and the GFD to provide new evidence on the effect that the entry of foreign and private-domestic banks, universal banking and listing of banks on the stock market, have on bank performance. Banks are segmented into groups based on their bank-specific attributes and their average efficiencies and bestpractice differences compared. Relevant policy recommendations are drawn from the analysis for both the banking regulator and bank management. The final methodological contribution extends the GFD by defining a further decomposition of the global frontier shift, into components that indicate whether an observation is situated in a more or less favourable location in the production possibility set. Consequently, a four-factor “Newly-decomposed Malmquist productivity change index” is proposed. The index and its decompositions have potentially interesting policy implications, which are illustrated using the empirical data on Ghanaian banks. The index is in the spirit of the standard Malmquist index but the intuition is that some components can be used to draw conclusions about productivity changes for a whole population of firms whilst others determine whether individual firms are in favourable locations and/or moving towards locations that are more favourable over time. More importantly, arguably, a listed, universal or foreign bank can be located in a favourable position and move towards location that is more favourable by virtue of its bank-specific attributes or by contributing more towards CSR. These factors are explored and policy measures prescribed in the final contribution of the thesis.
|Item Type:||Thesis or Dissertation (PhD)|
|Subjects:||H Social Sciences > HG Finance|
|Library of Congress Subject Headings (LCSH):||Financial institutions, Data envelopment analysis, Social responsibility of business, Banks and banking, Banking law|
|Institution:||University of Warwick|
|Theses Department:||Warwick Business School|
|Supervisor(s)/Advisor:||Podinovski, Victor V. ; Asmild, Mette|
|Extent:||46, 302 leaves : ill., charts|
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