During the 1980s and early 1990s, the world insurance market grew substantially. World insurance premiums in 1993 accounted for about 8 percent of world gross domestic product (GDP), compared to 4 percent in 1984. This article explains a substantial proportion of the variation in propertyliability insurance consumption across countries belonging to the Organization for Economic Cooperation and Development (OECD). The study focuses on two lines of insurance: motor vehicle and general liability. The authors' analysis indicates that economic conditions affect the demand for insurance differently across lines of coverage. In particular, the authors' results suggest that income has a far greater effect on motor vehicle insurance consumption than on general liability insurance consumption. The authors find evidence that several factors are important in explaining the purchase of both kinds of insurance. These factors include income, wealth, the percent of a country's insurance market controlled by foreign firms, and the form of the legal system in the country.
What causes an asymmetric alliance to end? This study explores how changes in the capabilities of the weaker ally in an asymmetric alliance can cause the alliance to end. Here I argue that, since the weaker ally in the asymmetric alliance is vulnerable to the influence of the stronger ally, an increase in the capabilities of the weaker ally can increase the likelihood of alliance termination. That is, the underlying motivation of the weaker ally to gain (or restore) more autonomy can increase the likelihood of termination. More precisely, I argue that the effect of the change in capabilities of the weaker ally on alliance termination is conditional upon its economic dependence on the stronger ally. A weaker ally that is highly dependent economically on its strong partner may be restrained from seeking autonomy because it could hamper ongoing economic relations with the stronger ally. Thus, I hypothesize that when there is an increase in the capabilities of the weaker ally, an alliance in which the weaker ally's economic dependence is high is less likely to result in termination than an alliance in which the weaker ally's economic dependence is low. Empirical analysis lends strong support to this hypothesis.Key Words: change in capabilities, asymmetric alliance, alliance termination, economic dependence, autonomy, weaker ally, stronger state hat causes an asymmetric alliance to end? To answer this question, this study explores the effect of changes in the capabilities of the weaker ally on alliance termination. Prior studies suggest that changes in the capabilities of allied states are associated with alliance termination (Morrow 1991; Bennett W
This study explores how geographical proximity and power distribution between allies interact and affect alliance duration. Morrow (1991), based on the security-autonomy trade-off model, claims that asymmetric alliances are likely to last longer than symmetric ones. This paper, however, argues that the effect of the relative power distribution between allies on alliance duration can be conditional upon the distance between allies because geographical proximity between allies may serve to aggravate or dampen the autonomy concerns of allied states-for example, one ally may be concerned about the mounting influence of its alliance partner and this concern could be severe in case of unequal alliances because of presumably the overwhelming influence of the former on the latter, but this kind of concern may be alleviated if the two allies are geographically remote. By contrast, in case of symmetric alliances, the equal power status between allies may relieve such autonomy concerns but geographical remoteness between them may impede the effective and efficient operation of alliances. Hence, this study hypothesizes that geographically remote and unequal alliances are more likely to last longer than geographically close and unequal alliances and that geographically close and equal alliances are more likely to last longer than geographically remote and equal alliances. These hypotheses are put to test against the allied-dyad data covering the period of 1816-2002 and I find strong support for these hypotheses. However, the findings in the robustness check suggest that these findings be accepted with some reservation especially in the case of bilateral alliances.
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