We investigate the influence of institutional factors upon life insurance demand for 32 European countries, considering the sociodemographic and economic determinants as control variables. Using a panel data approach, we find that life insurance demand is influenced differently by institutional indicators from the Worldwide Governance Indicators database, in emerging and transition markets compared to developed ones. The sound legal environment of developed countries, where the level of the rule of law is very homogeneous and very high, makes it non-significant for life insurance demand. For developing countries the enforceability of contracts, the independence of justice and the time efficiency of the judicial process positively influence the decision of citizens to buy life insurance contracts. The effect of income distribution over life insurance density varies across these two categories of countries. For transition and emerging markets we find a positive relationship between life insurance density, income distribution and level of urbanisation. In developed countries, because of the high levels of income, life insurance became a common good, not a luxury one, which makes income distribution an insignificant factor. For emerging and transition countries policymakers should concentrate more on strengthening trust in the insurance sector for reducing the gap with developed countries.

No abstract

This work expands the literature on a less studied topic, the Chief Executive Officer (CEO) turnover in post-communist economies, analyzed during an unstable and ambiguous economic and financial environment. For the period 2005–2010, the results indicate the political inference in CEO turnover decision for the Romanian listed companies. In this period, with great turmoil in the economy determined by the financial crisis of 2008, we also find that CEO gender helps to explain the probability of changing the CEO. Moreover, this paper empirically tests if the financial and corporate governance determinants that are validated in the existing literature work for the Romanian listed companies. We reinforce that CEO turnover decision is negatively related to accounting-based performance. We find evidence of the “voting with their feet” behavior of institutional investors, and of the lack of Board of Directors monitoring. The CEO–Chairman duality and the controlling power of the largest shareholder act as entrenchment mechanisms.

We investigate the impact of new financial and economic determinants on life insurance demand for 29 OECD countries for the period 2005–2017 while controlling for a set of widely used socio-demographic and economic characteristics. Based on a panel smooth transition regression model, we find a regime-switching effect characterising the impact of bank concentration and interest rate on the size of the life insurance market, in light of the old-age dependency ratio as the threshold variable. We also show that life insurance development is boosted in countries with high scores for investment freedom and with high levels of foreign direct investment rates, regardless of the level of the old-age dependency ratio. The impact of GDP per capita on the demand for life insurance products is positive and statistically significant, regardless of the level of the threshold variable.

The mutual fund industry has grown considerably in many countries since the 1990s. Its evolution has been explained primarily in terms of its economic and fi nancial determinants. We draw on a dynamic set of measures for socio-cultural values to explain the diff erential development of mutual funds across the world. Using a sample of 38 countries for the period 1996-2009, we fi nd a positive relation between the perception of happiness and the size of the mutual fund industry. Freedom of choice, a feature of countries that are dominated by individualistic behaviours and values, has a positive impact on the development of the industry. We also explain the positive relation between individuals' preference for private ownership and the development of mutual funds. Moreover, we prove that the industry is larger in developed countries with greater stock market liquidity, with low ratios of remittance infl ows to GDP, and in which the industry is older.