Based on the translog cost function for empirical analysis of the scope economies of state-owned commercial banks in China

The scope economies of commercial banks is not only a theoretical issue, but also an empirical question. Firstly, this article explains the connotation and definition of economies of scope of commercial banks from the perspective of industrial organization theory, and then uses the translog cost function to construct econometric model. Based on the panel data (2005-2010) of China´s four state-owned commercial banks, the article empirical estimates the scope of the economic situation. The results show that, in the sample years, China´s state-owned commercial banks have achieved the economies of scope. In recent years, the reform of state-owned commercial banks has been proved effective. Finally, based on the above analysis this article puts forward the policy recommendations.