The x-efficiency of a group-based lending institution: the case of the Grameen Bank

摘要

This paper estimates and examines the determinants of the Grameen Bank's (henceforth GB) cost inefficiency using branch-level cost data to 1988-91. The average inefficiency score for the GB runs from 3 percent to 6 percent. Female branches are foundto be more efficient than other types of branches. Three variables, primary school, secondary school, and bank density per square mile are found to be of expected signs and statistically significant. Neither the age of a branch nor size is significant. Allowing nongovernmental organizations (NGOs)to operate side by side may increase the level of competition among them, and thus increase their operational efficiency. The government may invest in infrastructure development, which will help reduce the transactions costs of GB and hence improve their operational efficiency.