Finance Discipline Group
UTS Business School
University of Technology, Sydney

Working Paper Series

Ownership Structure and Building Society Efficiency
Author(s): Tiffany Hutcheson & Ian Sharpe
Date of publication: October 1997
Working paper number: 78
This paper investigates the effect of ownership structure on the cost efficiency of Australian building societies using the stochastic econometric frontier approach. Contrary to the expense preference hypothesis, mutually owned societies we found to be, on average, more cost efficient than those under stock ownership. Moreover, mutual and stoc-owned societies have significantly different cost functions or production technologies. The results are consistent with U.S. results of Mester (1993).
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Comments: Published as: Hutcheson, T. and Sharpe, I., 1998, "Ownership Structure and Building Society Efficiency", Australian Journal of Management, 23(2), 151-168.