Technical inefficiency and output scale in banking and industry

Autores/as

  • Gerasimos T. Soldatos

DOI:

https://doi.org/10.17811/ebl.9.3.2020.270-278

Resumen

According to this paper, technical inefficiency unrelated to problem loans on the part of banks, would result in loan expansion, inducing, in turn, firms that rely heavily on bank borrowing, to expand their production accordingly as they can benefit from higher lending. Increased scale of production fosters economies of scale, which can compensate for the adverse effects of technical inefficiency on cost, reinforcing at the same time sales. Production can expand even further if firms maximize their profit by acknowledging their own technical inefficiency in the form of scale inefficiency.

Citas

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Descargas

Publicado

2020-12-13

Cómo citar

Soldatos, G. T. (2020). Technical inefficiency and output scale in banking and industry. Economics and Business Letters, 9(3), 270–278. https://doi.org/10.17811/ebl.9.3.2020.270-278