Efficiency, Productivity and Risk Analysis in Turkish Banks: A Bootstrap DEA Approach

Abstract

This paper, by using Data Envelopment Analysis (DEA) and Malmquist Productivity Index, addresses the impacts of 2007 global financial crisis on the efficiency and productivity of Turkish banks, during 2003-2010 periods. Moreover, a risk taking measure is introduced for each bank and two-stage regression is used to analyze the determinants of DEA efficiency scores. However, because of the existence of inherent dependency among DEA efficiency scores, the basic assumption of regression analysis, i.e., independence within the sample is violated. Hence, to overcome the dependency problem and to be able to make valid statistical inferences, bootstrapping method is applied. This paper attempts to extend the existing DEA literature by applying some of the remarkable methods suggested to improve DEA efficiency and productivity estimates altogether, for the case of Turkey to observe the impacts of recent 2007 global financial crisis.Data Envelopment Analysis, Malmquist Productivity Index, Efficiency and Productivity, Bootstrapping