Analyzing profit efficiency of banks in India with undesirable output – Nerlovian profit indicator approach
Year: 2014
Type: article
Abstract: The objective of this paper is to provide a holistic approach to measure the profit efficiency of banks, factoring desirable/undesirable outputs, using Nerlovian profit indicator approach. The profit inefficiency of banks has been decomposed into technical and allocation inefficiency using directional distance function. Results reveal that profit inefficiency of banks is primarily due to allocative inefficiency and the impact of technical inefficiency on profit inefficiency is minimal compared to allocative inefficiency, which indicates that banks need to focus on optimal utilization of input–output mix to enhance profit efficiency.
Source: IIMB Management Review
Authors: A.R. Jayaraman, M.R. Srinivasan
Institutions: Reserve Bank of India, University of Madras
Language: English
Field: Decision Sciences
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $1,200
OpenAlex ID: W1978114065