The X-efficiency Study Of Commercial Banks In China

The DEA (Data Envelope Analysis) is employed to serve X-efficiency solution of commercial banks in China in the paper. The SE (scale efficiency), PTE (pure technical efficiency), AE (allocative efficiency) and CE (cost efficiency) are presented in theoretic and empirical way, whose effect factors are also given. At the beginning, the SE is analyzed on the point of the bank branch number, banking concentration ratio and GDP growth rate. It is showed that when the bank is in DRS (i.e., decreasing return to scale), the branch number is in the trend of reduction, which is correlated to SE. And when banking concentration ratio gets lower, the banking average SE gets higher. And GDP growth rate is not correlative to SE according to the empirical result, though it is not so in theory. Secondly, the PTE is analyzed on the point of property right structure, technical improvement and financial innovation. It is discovered that the shared bank is better than the state owned in PTE because of shared property right structure, and technical improvement is helpful to PTE, but financial innovation is not in fact because current financial innovation is tool oriented in China. Thirdly, AE is analyzed on the point of internal factors of baink, HR (human resource) institution, property right structure and resource executive allocation. The internal factors include externalities and monitor cost. It is proved that when HR institution and resource allocation is more market oriented, AE is higher. And property right structure is crucial to AE. Finally, AE is proved to be the determinant of CE of commercial banks in China.