China's Banking Industry Economies Of Scale: Theory And Empirical Research

With the development of economy, the progress of science and technology, the role of financial markets have become increasingly prominent, while the banking sector as an important part of the financial markets, control the country's economic lifeline, its efficiency is directly related to the level of financial reform, but also commercial banks the core competitiveness and important form of expression. , also is the core content of commercial bank competitiveness and important form of expression. Reform of China's financial system had more than thirty years, during this period, five state-owned banks gradually restored and developed, policy banks, joint-stock commercial banks and other financial institutions have emerged as the deepening of reform for China's economic development continued into the power, but compared with the developed countries, the bank still exist some problems, for example low service quality, backward intermediate business, low profitability, poor ability to resist risks , so how to effectively improved the efficiency of China's banking industry, increase their competitiveness in the international banking is becomes very important.Based on the previous scholars about bank efficiency, this paper on the basis of economies of scale effect, with five state-owned Banks, 9 share-holding commercial Banks1997--2008 data as a sample, using generalized beyond the parameters of law of the cost function model, using panel data analysis method to economies of scale in China's banking industry of theoretical and empirical research, empirical results show that most of the state-controlled did not exist scale economic phenomenon, but has been improved obviously with its own series of adjustment and reform, the general trend of economies of scale factor is decreasing year by year but most of the joint-stock commercial bank exist slight scale economic phenomenon, economies of scale factor stability, and has significant room for improvement. The results also show that the ability of defending risk of our country banking is strengthened gradually, the Asian financial crisis and global financial tsunami that has a lot of impact on banking in china but economies of scale coefficient estimates show that China's banking industry has the strength and ability to withstand risks and maintain its own stability.In this paper, based on the empirical results ,compared state-owned Banks and joint-stock commercial bank's economies of scale coefficients, found the factors what impact scale economy, and in combination with the objective condition of banking industry, analyzed there is a gap between the scale economy of state-owned holding bank and share-holding commercial Banks is due asset scale, property rights system and technology, and put forward to achieve scale economy of China's banking industry, some Suggestions on how to enhance its competitiveness, in hopes of making some contribution on China's banking reform and development in the future...