X-efficiency versus rent seeking in Chinese banks: 1997-2006

Matthews, Kent ORCID: https://orcid.org/0000-0001-6968-3098, Guo, Jianguang and Zhang, Xu 2008. X-efficiency versus rent seeking in Chinese banks: 1997-2006. [Working Paper]. Cardiff Economics Working Papers, Cardiff: Cardiff University.

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Abstract

This study demarcates cost-inefficiency in Chinese banks into X-inefficiency and rent-seeking-inefficiency. A protected banking market not only encourages weak management and X-inefficiency but also public ownership and state directed lending encourages moral hazard and bureaucratic rent seeking. This paper uses bootstrap non-parametric techniques to estimate measures of X-inefficiency and rent-seeking inefficiency for the 4 state owned banks and 10 joint-stock banks over the period 1997-2006. The paper adjusts for the quality of loans by treating NPLs as a negative output. The paper shows that Chinese banks have reduced cost inefficiency and reduced X-inefficiency at a faster rate than rent-seeking inefficiency.

Item Type:	Monograph (Working Paper)
Date Type:	Publication
Status:	Published
Schools:	Schools > Business (Including Economics)
Subjects:	H Social Sciences > HB Economic Theory
Publisher:	Cardiff University
Date of First Compliant Deposit:	30 March 2016
Last Modified:	28 Oct 2022 10:18
URI:	https://orca.cardiff.ac.uk/id/eprint/77807

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