The Effect of Globalization on Efficiency Change, Technological Progress and the Productivity Growth of U.S. Small and Large Banks

North American Journal of Finance and Banking Research, Vol. 1, No. 1, 2007

21 Pages Posted: 20 Jan 2010

See all articles by Seyed M. Mehdian

Seyed M. Mehdian

University of Michigan at Flint

Mark J. Perry

University of Michigan at Flint

Rasoul Rezvanian

Northeastern Illinois University

Date Written: October 12, 2007

Abstract

A non-parametric approach is used to examine the effects of globalization and deregulation on the efficiency and productivity growth of small and large banks in the U.S. between 1990 and 2003. Using a representative sample of commercial banks, the study finds empirical evidence that both small and large banks made significant technological progress and productivity growth between 1990 and 2003. In addition, the statistical evidence shows that large banks are generally more efficient than small banks for most efficiency indices in both years. However, despite globalization, deregulation, and the gains in technology and productivity, there was a decrease in overall efficiency for both large and small banks in 2003 compared to 1990, caused exclusively by allocative inefficiency.

Keywords: Banking, technological change, efficiency, firm performance

JEL Classification: G210, G280, L220

Suggested Citation

Mehdian, Seyed M. and Perry, Mark J. and Rezvanian, Rasoul, The Effect of Globalization on Efficiency Change, Technological Progress and the Productivity Growth of U.S. Small and Large Banks (October 12, 2007). North American Journal of Finance and Banking Research, Vol. 1, No. 1, 2007, Available at SSRN: https://ssrn.com/abstract=1536643

Seyed M. Mehdian (Contact Author)

University of Michigan at Flint ( email )

Flint, MI 48502
United States

Mark J. Perry

University of Michigan at Flint ( email )

Flint, MI 48502
United States

Rasoul Rezvanian

Northeastern Illinois University ( email )

5500 N. St. Louis Ave
Chicago, IL 60625
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
201
Abstract Views
1,590
Rank
273,540
PlumX Metrics