New model reveals hidden factors impacting returns to scale in banking.
The article introduces a new model to analyze data from large commercial banks in the U.S. The model looks at how different factors affect the banks' returns over time. The researchers developed a method to estimate these effects, even when some data is missing. They tested their method using computer simulations and found it works well. This new approach addresses some important issues that previous studies have overlooked in the field of production economics.