Economies of diversification in the banking industry

摘要: Abstract This paper defines a new measure, economies of diversification, to examine the cost effect product line expansion. measure is special case expansion path subadditivity and contains scope as case. A nonparametric frontier technique which isolates effects inefficiency scale used diversification. Applied set 468 U.S. depository institutions operating in 1984, we find slight diseconomies Diseconomies diversification due overutilization resources are found be more important determinants bank costs than failure operate at optimal scale.