Cost efficiency analysis of Swedish financial enterprises: An empirical investigation

In this paper, our research question that could analyze how efficiency in Swedish financial enterprises has changed since the banking crisis in 1993. We estimate the time-invariant and time-variant efficiencies of Swedish financial enterprises with four different estimators. These estimators are the Pooled Model (Aigner et al., 1977), the fixed effects model (Schmidt & Sickles, 1984), the random effects model (Battese & Coelli, 1995) and the TRUE fixed effects model (Greene, 2005) efficiency estimators. We predict cost function by employing panel stochastic frontier approach. These allow us to construct cost efficiency.