Measuring returns to scale and technological change in co-operative banks: A provincial analysis of Canadian credit unions and caisses populairesChan, M.; Mountain, Dean
doi: 10.1007/BF01977002pmid: N/A
In Canada economies of scale in credit unions come not only from large single office arrangements but from external economies realized from belonging to central provincial credit unions. Making use of aggregate provincial time series and cross-sectional data, this study begins by employing a sequential Akaike's Information Criterion (AIC) test to select the most appropriate model. This procedure permits the isolation of economies of scale from technological change effects. For all provinces, economies of scale are discovered to be significantly different from 1, and for five of the eight provinces examined, technological change was statistically significant from zero. The larger the provincial organization, as illustrated by the Quebec caisses populaires, the higher we find estimates of returns to scale and technological change. An implication may be that both expansion and more centralization should be encouraged and that other provinces may be able to increase efficiency by imitating some of Quebec's operational and administrative practices.
A note on estimating disequilibrium models with aggregationQuandt, R.
doi: 10.1007/BF01977003pmid: N/A
When an aggregate disequilibrium is the result of disequilibrium in several submarkets, the usual maximum likelihood estimation, which is based on the min of aggregate demand and supply, represents a misspecification. The present paper compares ML with several nonlinear least squares methods that are appropriate for this situation. Monte Carlo experiments suggest that ML is robust with respect to the misspecification and may be preferable to the nonlinear least suqares methods in some situations.
From the general to the specific: The demand for M2 in three European countriesTaylor, M.
doi: 10.1007/BF01977004pmid: N/A
This paper examines the demand for broad money in West Germany, the Netherlands and France. We give an exposition of and apply the “general to specific” econometric modelling methodology which has been successful in modelling the demand for money in the U.K. We find stable short-run demand functions for each of the three countries examined, using a consistent data base previously published by other researchers. Each of the estimated short-run equations has a long-run or steady-state solution which is consistent with economic theory. For West Germany and the Netherlands we find long-run income elasticities of unity, which constrasts with the results of earlier studies.