Research On Total Factor Productivity Mensuration Of China's Commercial Banking

With the continuous reform of Chinese banking, Chinese commercial banking has gradually changed into the phase, in which state—owned commercial banks occupy domination, combined with the co—existed competition with joint—stock commercial banks, city commercial banks and foreign banks. With the entrance of WTO, the deadline of protection of domestic banks approaches, along side with the integration of global economy, and domestic banks will be confronted with drastic competition with big bank groups from western developed countries. In order to provide policy basis for future reform, it is of great significance to study the competitiveness of Chinese commercial banks, correctly evaluate the performance of Chinese commercial banks, analyze the productivity and its fluctuation of domestic banks, examine the gap between domestic and overseas banks, and explores the reasons. On the other hand, enhancing the productivity of commercial banks is favorable to the financing structure reform of socialist market economy, also thus can guarantee the security of the capital market.At first, based on the current economic background, this thesis has pointed out the significance and necessity of enhancing the productivity of commercial banks, then reviewed the correlative research of TFP of commercial banks in previous years, Secondly, synthesized the previous research results to specify the definition of productivity and analyse its evolution and economic theoretical basis, then comparatively analyse the different mathematic approach and model on TFP; Finally, parametric stochastic frontier approach has been employed to measure the productivity of each commercial bank in 1996-2003 and also estimate the total factors for productivity fluctuation, drawing the conclusion that productivity of domestic banks are inclined to increase with the entrance of WTO, and domestic commercial banks' productivity increase more than that of joint—stock commercial banks, finding that the increase lies in the efficiency improvement and technical progress. In short term, the improvement of efficiency make great effect on the productivity increase but the improvement will be limited, while in long term, technical progress is the eternal motive power for productivity increase of banks. Based on the above results, some reasonable proposals have been made in this paper.