Faculty Scholarship 1994 - Present

Assessing the Relationship Between Liberalization, Ownership & Performance in Banking: The Case of Turkish Banks

[Received Best Paper Award] This paper employs a DEA-type Malmquist index approach to evaluate the impact of financial liberalization on the productivity changes of public, private, and foreign banks in Turkey during the period between 1981 and 1990. The results indicate that all forms of banks have benefited from financial liberalization. However, foreign banks were found to be the most productive, followed by private banks and public banks respectively. The major source of productivity gains is scale changes for public and private banks and technical progress for foreign banks. It also seems that productivity growth indices of all banks converge towards the end of liberalization period.