Bank Efficiency: Evidence from a Panel of European Banks
The goal of this paper is to investigate the efficiency of the banking systems in eight European countries over the period 1994 to 2008 by using the production frontier methodology. The paper shows that risk factors along with a size variable should be taken into account, otherwise inefficiency tends to be overstated.
Key words: Bank efficiency, Stochastic frontier, European banks.
JEL: G21, C13, C32.