This paper estimates scale economy and the effects of technology progress in Chinese banking industry (1994～2001) by introducing SUR method. The empirical result shows that, as a whole, there exists slight scale diseconomy, but from the aspect of individual banks, the phenomenon of substantial scale diseconomy also exists among comparatively small jointequity commercial banks and the largest bank-ICBC, while scale economy exists among the other three Stateowned banks, which shows that there exists a U-sha...
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