Ownership and production efficiency: Evidence from Taiwanese banks

Yang Li*, Jin-Li Hu, Yung Ho Chiu

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

18 Scopus citations


In the early 1990s, Taiwan began her deregulation trend in order to enhance competition and economic efficiency across all industries. We derive a theoretical framework to predict possible rankings in technical efficiencies of public, mixed, and private banks. A panel data set with 43 Taiwanese banks during 1997-1999 is used for empirical analysis. We then apply a translog distanc̀e function to estimate technical efficiencies. The relationship between technical efficiency and government shareholding is also examined. Empirical results show that a public bank in Taiwan can improve its technical efficiency by mixed ownership at a diminishing rate. Moreover, banks in Taiwan on average performed worse after the 1997 Asian financial crisis.

Original languageEnglish
Pages (from-to)129-148
Number of pages20
JournalService Industries Journal
Issue number4
StatePublished - Jul 2004


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