The effects of shared ATM networks on the efficiency of Turkish banks

Author: Damar, H. Evren¹

Source: Applied Economics, Volume 38, Number 6, 10 April 2006 , pp. 683-697(15)

Publisher: Routledge, part of the Taylor & Francis Group

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Abstract:

This study investigates whether forming shared ATM networks has yielded positive benefits for banks in Turkey by increasing their productive efficiency. Using a Data Envelopment Analysis (DEA) approach, pure technical and scale efficiency scores of Turkish banks are estimated and analysed for the period 2000–2003. The results suggest that although it is possible to realize positive effects through ATM sharing arrangements, there are multiple factors that determine which banks realize such benefits. The geographical distribution of shared ATMs between urban and rural markets and the level of competition between banks within urban areas are shown to be important determinants of differences in bank efficiency. This discrepancy between the gains associated with ATM sharing may have important implications concerning the adoption and sharing of new technology by banks in developing countries.

Document Type: Research article

DOI: 10.1080/00036840500394264

Affiliations: 1: Department of Economics, Pacific Lutheran University, Tacoma, WA 98447-0003, USA

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