Evaluation of stock market technical efficiency with a comparison of groups of companies in Dhaka stock exchange

Hasan M. Z., KAMIL A. A., Baten M. A.

International Journal of Physical Sciences, cilt.6, sa.24, ss.5857-5865, 2011 (Scopus) identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 6 Sayı: 24
  • Basım Tarihi: 2011
  • Dergi Adı: International Journal of Physical Sciences
  • Derginin Tarandığı İndeksler: Scopus
  • Sayfa Sayıları: ss.5857-5865
  • Anahtar Kelimeler: Dhaka stock exchange, Inefficiency effects, Stochastic frontier model, Technical efficiency
  • İstanbul Gelişim Üniversitesi Adresli: Hayır

Özet

The objective of this study was to measure stock market efficiency of the groups of companies, such as Group-A (financial), Group-A (non-financial), Group-B and Group-Z of Dhaka stock exchange (DSE) market in Bangladesh applying the Stochastic Frontier approach, incorporating technical inefficiency effect model. Among the four groups, most efficient group was Group-A (financial) and most inefficient group was Group-Z. This study showed that the mean technical efficiency of the companies of DSE market during the period 2000 to 2008 was 0.8782. This implied that 87% of potential output was being realized by the companies of DSE market. In case of using production function model; it was found that the Translog production function was more preferable than the Cobb-Douglas production function. The technical efficiency rate was found gradually increasing over time in the stock market in Bangladesh. © 2011 Academic Journals.