Journal of Management Research
Volume 18, Number 2 (April–June 2018)
ISSN: 0972-5814 Online ISSN: 0974-455X
Input Efficiency of Japanese Securities Firms An Application of Stochastic Frontier Analysis
Jin-Li Hu, Satoshi Honma and Hsiao-Ping Hsieh
| Abstract |
This study adopts the stochastic frontier analysis (SFA) to compute the disaggregate inputs efficiency of securities firms in Japan. The panel data set contains a total of 23 securities firms during 2010-2014. This study employs three inputs (stakeholder equity, operating expenses, and the number of employees) and a single output (total revenue). The major empirical findings are as follows: Securities firms with higher total assets have lower efficiency scores on the efficiency of stakeholder equity and operating expenses, but have better efficiency of employees. Older securities companies have worse performance than younger securities companies in the use of stakeholder equity, operating expenses and employees. The higher TPX Index makes worse performance on the efficiency of operating expenses. In conclusion, Japanese securities firms have better performance on the efficiency of operating expenses, but still have a lot of room to improve the efficiency of stakeholder equity and employees.
