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Measuring Welfare Cost of Banking Industry in Iran: The Approach of Allocative and X-inefficiency
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Afsaneh Shafiee   , Ahmad Tashkini |
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Abstract: (18026 Views) |
| This study examines the social cost of banking industry in Iran (17 governmental and private banks) in an unbalanced panel data model.
To conduct estimations, two different approaches were taken: 1- Welfare Triangle approach 2- Libenstein’s approach. In the former, welfare triangle is measured assuming banking industry operating in full technical efficiency however, the latter includes both the effect of welfare triangle and the cost of likely technical X-inefficiency. The result of the first method showed that the social cost of banks in Iran is little, amounting to be less than 1 percent of GDP in 2008 while within the same period, the second method resulted in 4 percent of GDP, as the social cost of banks in Iran. |
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| Keywords: classification: Social Costs, X-inefficiency, Allocative inefficiency, demand elasticity, banking industry. |
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Type of Study: Applicable |
Subject:
رشد و توسعه و سیاست های کلان
Received: 2011/04/10 | Accepted: 2013/03/6 | Published: 2013/03/6
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