Financial System Efficiency Analysis Considering Technological Heterogeneity

The financial system plays a crucial role in national economic and social development.Thus,how to accurately measure and improve the operational efficiency of the financial system is a hot issue that both academia and industry are concerned about.Data Envelopment Analysis(DEA),as an effective tool for efficiency evaluation and efficiency optimization,has obtained many applications in financial system evaluation and other fields.However,due to the complex internal operation processes in the real financial systems(such as commercial banks and rural financial supply chain system),traditional DEA methods(including two-stage DEA)have many drawbacks when solving such problems:First,the existing methods do not take into account the characteristics of the intermediate output.For example,the intermediate output may be adjusted freely because of maximizing the efficiency of the decision-making unit.The intermediate output may also be maximized according to external environmental factors.Second,the existing two-stage DEA method assumes that all decision-making units are homogeneous,but this assumption is not always true in reality.For example,the banks under the different ownership structure have heterogeneity in operating technology.Different regional financial supply chain systems lead to heterogeneity in production technology due to different levels of local economic development.Third,most existing studies focus on the performance evaluation of decision-making units.Little attention has been paid to the efficiency improvement sources of inefficient units.In response to these shortcomings,this paper proposes a series of two-stage improved DEA methods.Compared with the traditional two-stage DEA method,the methods proposed in this paper has the following advantages.First,the undesired output(such as Bad Loan Ratio)during the operation of the financial system is considered in the efficiency analysis framework;second,the heterogeneity between financial systems such as commercial banks is considered to avoid overvalued efficiency and inconsistent with actual situation;third,inefficiency is decomposed into technical inefficiency and management inefficiency,and provides efficiency improvement suggestions for ineffective financial systems.This paper systematically analyzes the complex operation process of the real financial system,and puts forward the corresponding two-stage DEA model based on real problems.Finally,the proposed method is applied to the practical problems of the efficiency evaluation of my country's commercial banks and rural financial supply chains.The empirical research results of this article provide a series of decision-making and policy recommendations for improving the efficiency of my country's commercial banks and rural financial supply chains.The article mainly includes the following:Chapter 1 first briefly introduces the current development status of China's banking financial institutions,and then introduces the research significance,research methods and research content of this paper.Chapter 2 first introduces the basic theory of DEA performance evaluation theory,meta-frontier theory and direction distance function,and then reviews the previous studies related to the research content of this article,including:two-stage DEA,Bank efficiency evaluation based on single-stage DEA and bank efficiency evaluation based on two-stage DEA.Finally,a literature summary of the previous studies is carried out.Chapter 3 combines meta-frontier and DEA to propose an improved network model to evaluate the efficiency and technological heterogeneity of loans/deposits system of Chinese commercial banks.Then,this chapter proposes an efficiency improvement potential path index to determine the source of improvement for inefficient banks.Finally,this chapter uses a multiple regression model to analyze the impact of ownership structure on deposit/loan efficiency of banks.Chapter 4 regards intermediate variables as free variables,and proposes a two-stage DEA method by introducing Kuosmanen technology.This method can not only effectively characterize the convexity of the constraint,but also set the target of the intermediate variable according to the actual situation.Finally,this chapter applies the proposed model to the empirical analysis of Chinese commercial banks,and gives performance improvement suggestions to ineffective banksChapter 5 proposes a non-radial two-stage DEA model based on the complex structure of the rural financial supply chain(RSCF)system and the technical differences between the rural financial supply chains.Based on the fact that China's financial sector strongly supports agricultural loans,the model proposed in this chapter maximizes intermediate output as much as possible.Then,we apply the model proposed in this chapter to conduct an empirical analysis on the performance of China's inter-provincial rural financial supply chains.Chapter 6 summarizes the full text and provides future researches.