Analysing the Total Factor Productivity Change Among Urban Cooperative Banks in India: The Malmquist Productivity Approach

This study investigates the total factor productivity (TFP) growth among urban cooperative banks in India during 2014–2020. The measurement of productivity is done using the data envelopment analysis-based Malmquist productivity index. We use two different models, viz., the intermediation approach and the production approach, to see how productivity estimates vary with the change in inputs and outputs. Our results show a large asymmetry in productivity estimates both among banks and over time. TFP estimates were consistently higher under the production approach vis-à-vis the intermediation approach. Further, the empirical results show that productivity gains were mainly determined by technological progress rather than efficiency improvements. Thus, collaborations in technological know-how can be beneficial to productivity growth. JEL Classifications: G15, G21, G34