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Efficiency analysis of UAE banks using data envelopment analysis

Efficiency analysis of UAE banks using data envelopment analysis Purpose The current study aims to explore and measure the profitability, marketability, and social disclosure efficiency of UAE banks using a nonparametric frontier method data envelopment analysis DEA.Designmethodologyapproach In order to estimate the relative efficiency of the Emirati banks based on three different dimensions profitability, marketability and social disclosure, a sample of 20 listed Emirati banks in 2009 is first selected. Second, a disclosure index to measure the extent of their social disclosure is developed and utilized. Third, the inputoriented version of DEA model is deployed to estimate their technical and scale efficiency.Findings Based on nonparametric Wilcoxon signed rank test, paireddifference t test and sign test, this study reports significant evidence that the UAE banks are performing much better in profitability and social disclosure activities than marketability activities. The results also provide additional evidence regarding the positive relation observed between the performance of social disclosure and profitability performance.Research limitationsimplications The sample is small, although it includes all relevant Emirati banks. Moreover, followup research using panel data derived from the UAE banking sector are required to test and generalize the current results.Originalityvalue The paper is original in its approach by introducing social disclosure as a new empirical dimension to the literatures of banking efficiency analysis using DEA. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Economic and Administrative Sciences Emerald Publishing

Efficiency analysis of UAE banks using data envelopment analysis

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
1026-4116
DOI
10.1108/10264111311319204
Publisher site
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Abstract

Purpose The current study aims to explore and measure the profitability, marketability, and social disclosure efficiency of UAE banks using a nonparametric frontier method data envelopment analysis DEA.Designmethodologyapproach In order to estimate the relative efficiency of the Emirati banks based on three different dimensions profitability, marketability and social disclosure, a sample of 20 listed Emirati banks in 2009 is first selected. Second, a disclosure index to measure the extent of their social disclosure is developed and utilized. Third, the inputoriented version of DEA model is deployed to estimate their technical and scale efficiency.Findings Based on nonparametric Wilcoxon signed rank test, paireddifference t test and sign test, this study reports significant evidence that the UAE banks are performing much better in profitability and social disclosure activities than marketability activities. The results also provide additional evidence regarding the positive relation observed between the performance of social disclosure and profitability performance.Research limitationsimplications The sample is small, although it includes all relevant Emirati banks. Moreover, followup research using panel data derived from the UAE banking sector are required to test and generalize the current results.Originalityvalue The paper is original in its approach by introducing social disclosure as a new empirical dimension to the literatures of banking efficiency analysis using DEA.

Journal

Journal of Economic and Administrative Sciences – Emerald Publishing

Published: May 10, 2013

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