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Financial Innovation

Table 8 Robustness test: Heckman’s (1979) two-stage model

From: Bank efficiency in Middle East and North African countries: Does political connection type matter?

Variables

CE

TE

AE

CE

TE

AE

CE

TE

AE

A_PC

 − 0.069***

 − 0.063***

 − 0.324***

      
 

(− 3.23)

(− 3.11)

(− 3.07)

      

CEO_PC

   

 − 0.216***

 − 0.481***

 − 0.332***

   
    

(− 2.76)

(− 2.69)

(− 2.86)

   

BD_PC

      

 − 0.105**

 − 0.306**

0.151

       

(− 2.26)

(− 2.28)

(0.41)

SIZE

 − 0.058***

 − 0.056***

 − 0.083***

 − 0.058***

 − 0.082***

 − 0.059***

 − 0.058***

 − 0.057***

 − 0.081***

 

(− 5.73)

(− 5.62)

(− 3.01)

(− 6.52)

(− 3.22)

(− 9.31)

(− 4.44)

(− 4.51)

(− 5.82)

CAR

 − 0.058**

 − 0.121***

0.091

 − 0.081

0.088

 − 0.137**

 − 0.056**

 − 0.124**

0.096

 

(− 2.37)

(− 6.11)

(0.99)

(− 1.34)

(0.66)

(− 2.08)

(− 2.18)

(− 2.35)

(1.02)

CRD_RQ

0.032*

 − 0.073***

 − 0.163

0.029

 − 0.151

 − 0.081

0.030

 − 0.085**

 − 0.162*

 

(1.71)

(− 4.63)

(− 1.60)

(1.03)

(− 1.45)

(− 1.51)

(1.44)

(− 2.08)

(− 1.79)

PROF

0.272***

 − 0.008

 − 0.377***

0.275***

 − 0.383***

 − 0.007

0.275***

 − 0.007

 − 0.353***

 

(8.13)

(− 0.96)

(− 9.21)

(4.15)

(− 3.01)

(− 0.81)

(6.23)

(− 0.41)

(− 9.16)

BAN_CON

0.001

0.001

 − 0.003**

0.001

 − 0.003***

0.001

0.001

− 0.001

 − 0.003***

 

(0.42)

(0.81)

(− 2.36)

(0.18)

(− 2.81)

(0.038)

(0.31)

(− 0.17)

(− 3.08)

DOM_CR

0.001**

0.001***

 − 0.001

0.0001

 − 0.001

0.001*

0.001**

0.001**

 − 0.002

 

(2.05)

(6.42)

(− 0.65)

(1.21)

(− 0.86)

(1.84)

(1.97)

(2.36)

(− 0.61)

GDP_GR

0.003**

0.002**

 − 0.001

0.003

 − 0.002

0.002

0.003**

0.002

 − 0.002

 

(2.06)

(1.98)

(− 0.19)

(0.97)

(− 0.37)

(0. 97)

(2.19)

(0.96)

(− 0.80)

INF

0.172**

0.031

0.491

0.168

0.566

0.061

0.177**

0.045

0.599

 

(2.24)

(0.60)

(1.15)

(1.11)

(1.31)

(0.35)

(2.13)

(0.32)

(1.43)

POL_RISK

 − 0.106

 − 0.063

0.106

 − 0.103

0.183

 − 0.029

 − 0.114

 − 0.021

0.319

 

(− 1.49)

(− 1.07)

(0.27

(− 0.75)

(0.47)

(− 0.15)

(− 1.54)

(− 0.15)

(0.89)

WEPU

 − 0.024*

0.003

 − 0.015

 − 0.023

 − 0.008

0.006

 − 0.025*

0.003

 − 0.023

 

(− 1.87)

(0.26)

(− 0.22)

(− 0.89)

(− 0.11)

(0.17)

(− 1.74)

(0.11)

(− 0.32)

PAND_CRIS

 − 0.005***

 − 0.003**

 − 0.061***

 − 0.005**

 − 0.059***

 − 0.004**

 − 0.006***

 − 0.003**

 − 0.058***

 

(− 2.67)

(− 2.18)

(− 3.01)

(− 1.98)

(− 2.99)

(− 2.22)

(− 2.65)

(− 2.11)

(− 3.01)

Year dummies

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Country dummies

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Inverse Mills ratio

 − 0.062

 − 0.081

0.202

 − 0.089

 − 0.078

0.255

 − 0.126

 − 0.305

0.325

(− 0.77)

(− 0.89)

(1.46)

(− 0.97)

(− 1.18)

(1.37)

(− 0.57)

(− 0.84)

(0.96)

Wald χ2

(501.81)***

(908.12)***

(55.31)***

(388.67)***

(899.4)***

(79.83)***

(493.34)***

(747.09)***

(51.76)***

  1. This table reports the Heckman two-step regression results for the effect of political connections (A_PC, CEO_PC, and BD_PC) on bank efficiency (CE, TE, and AE) for the 2008–2021 period. t-values are in parentheses
  2. ***, **, and * denote 1%, 5%, and 10% significance levels, respectively. See variable definitions in Table 10 in “Appendix”
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