Productividad, competencia e innovación en la banca privada española (1900-1914)

This study investigates the productivity differences and its sources across a set of banks during the last years of the liberal era of the Spanish banking system (1900-1914). These years were characterised by major qualitative and quantitative changes in the banking industry including a sharp increase in the size of the system, in the number of firms, and in its regional distribution. Employing DEA productivity analysis and the Malmquist index, we discover that these changes were accompanied by a generalised increase in the efficiency of least productive banks. Also, we observe that the crisis of some regional banking groups, like the Catalan, can be linked with its low productivity levels. In consequence, in the light of our productivity evidence, we conclude that the increase in competition was beneficial for the system because helped to the success of the most efficient banks.