Social Capital and Bank Performance: An International Comparison for OECD Countries

43 Pages Posted: 8 Feb 2008

See all articles by José Manuel Pastor

José Manuel Pastor

University of Valencia; Universidad de Alicante - Valencian Institute of Economic Studies

Emili Tortosa-Ausina

Jaume I University - Department of Economics

Abstract

Over the last few years the literature on social capital and bank efficiency analysis has expanded rapidly. We merge them by analyzing how social capital affects bank efficiency in OECD countries. We use activity analysis techniques to measure efficiency, and social capital, which is related to the concept of generalized trust, is considered an environmental variable. Results suggest that the effect of social capital is more relevant for those financial institutions operating in low-social-capital environments. In these cases, inefficiencies are biased upwards, and controlling for social capital enables these banks to move up in the efficiency rankings.

Suggested Citation

Pastor, José Manuel and Tortosa-Ausina, Emili, Social Capital and Bank Performance: An International Comparison for OECD Countries. Manchester School, Vol. 76, Issue 2, pp. 223-265, March 2008, Available at SSRN: https://ssrn.com/abstract=1090709 or http://dx.doi.org/10.1111/j.1467-9957.2007.01058.x

José Manuel Pastor (Contact Author)

University of Valencia

Avda. de los Naranjos s/n
Valencia, Valencia E-46022
Spain

Universidad de Alicante - Valencian Institute of Economic Studies

03071 Alicante, sn 46022 E
Spain

Emili Tortosa-Ausina

Jaume I University - Department of Economics ( email )

Campus del Riu Sec.
E-12071 Castellon
Spain

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