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Measuring Scale Economies in a Heterogeneous Industry:
The Case of European Settlement Institutions

by Patrick Van Cayseele and Christophe Wuyts,Vienna, 2006

ISBN 978-3-902109-33-0

We examine whether the European settlement institutions are technically efficient. This is done by means of estimating a translog cost function, and investigating whether scale economies are fully exploited. Since the sample is quite heterogeneous, fixed effects regression is introduced. From the results obtained, there clearly are economies of scale in this industry throughout all output ranges. This implies that further consolidation in this industry probably is ahead.
The European clearing, settlement and safekeeping industry
Review of the literature
The model
Estimation results

Additional Info
Keywords: Technical Efficiency in Settlement and Safekeeping, Estimating Cost Functions on Panel Data, Sample Heterogeneity and Fixed Effects
JEL Codes: C8, D2, G2, L8
ISBN No.: 978-3-902109-33-0
Authors: Patrick Van Cayseele and Christophe Wuyts

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