The impact of the financial crisis on the productivity of Thailand's financial institutions

Using a new dataset of Thai financial institutions, this paper analyzes the dynamics of productivity over the past decade (1989-1998), including the impact of the financial crisis of recent history. We find productivity increased substantially in the wake of Thailand's financial liberalization (1992-1996); this was followed by a precipitous fall during the crisis (1996-1997). To test the robustness several specifications are undertaken: four models (differing with respect to whether or not risk and deposits are included as inputs), and two frontiers (one where banks and finance companies are treated separately, the other where the data are pooled) are analyzed.